Policy Framework

The Industrial Strategy provides a 10-year plan intended to deliver the certainty and stability businesses need to invest in the high-growth sectors, identifying industries that will be a focus for the UK economy. As the backbone to the identified sectors, I&L isn’t given the recognition it deserves within the Industrial Strategy, however the NPPF does give express recognition of the importance to the modern economy of freight and logistics, laboratories, gigafactories, data centres and digital infrastructure.

What is clear is that the importance of economic growth has been elevated in terms of both government messaging and national policy, and the raised I&L profile will carry weight in the planning process.

Green Belt

Relaxation of Green Belt policy presents an interesting opportunity for the industry to explore, particularly given I&L development’s appetite to be close to our major motorways and the number of motorway junctions that fall within the Green Belt (44% in England, according to research undertaken by Savills Economics).

The potential of ‘Grey Belt’ has been explored in detail, particularly in the context of new homes delivery. In summary, the NPPF definition of Grey Belt land is those sites within the Green Belt that are previously developed and/or do not strongly contribute to the following purposes:

• to check the unrestricted sprawl of large built-up areas
• to prevent neighbouring towns merging into one another
• to preserve the setting and special character of historic towns

While many residential developers have been quick to explore Grey Belt potential, our experience is that I&L developers have been more cautious in committing to site searching. Given the synergy between Green Belt and the motorway network, there are obvious areas of focus for I&L Grey Belt opportunities in the short/medium term.

Perhaps more significant for strategic development is the NPPF’s confirmation that exceptional circumstances exist to justify a review of the Green Belt where an authority cannot meet its identified full need for homes, commercial or other development through other means. For I&L that means there is now a policy framework that supports the review and release of Green Belt land where there is demand, for example strategic employment needs, that can’t be met elsewhere and the proposal wouldn’t undermine the purposes of the Green Belt designation.

A missed opportunity for a national floorspace target for employment

Savills Planning in conjunction with Savills Economics has developed its own method for estimating future commercial needs. Called ‘suppressed demand’ it takes a more market demand and supply driven approach to estimating future needs and has been accepted in support of numerous successful planning applications, Local Plan promotions and planning appeals.  

Savills has suggested the government include a nationally-driven floorspace target for employment that takes account of the suppressed demand approach as a better way to plan for the true potential of the English economy and unlock the growth the government is seeking. 

In the absence of such a target, the ability to persuade local authorities of demand for strategic employment development that serves regional/national/international need requirements will remain a challenge. This lack of numeric accountability means there will continue to be subjectivity in terms of the level of growth delivered through plan-making and planning applications. 

As a consequence, the tone set by local authorities, the Planning Inspectorate and secretary of state through decision taking will be critical to providing confidence in the sector to persuade developers and investors to bring forward sites for development.

Significant planning decisions in 2024

There have been a number of headline-grabbing decisions since Labour’s general election victory that give hope to the employment sector. 

Within a matter of days of coming into government Angela Rayner called-in two data centre appeals and in December allowed Affinius Capital’s 700,000 sq ft scheme at Court Lane Industrial Estate in Buckinghamshire.

Similarly, within a few hours of the NPPF being issued, Three Rivers’ planning committee approved an industrial unit on Grey Belt land in Kings Langley.

There was also a significant Green Belt release at the South Mimms M25/A1(M) junction, with a 120,000 sq ft industrial building unanimously approved in light of a robust needs argument for Hertsmere and the sub-region. It was accepted that the site was ideally placed to help respond to the unmet need, and that the scheme would deliver benefits to the wider economy in terms of the contribution from jobs and economic activity, but also because of the critical role it plays in supporting other sectors of the economy. The need case for this scheme was supported by Savills Economics using our suppressed demand methodology.

While the speed and nature of these decisions is promising, it’s clear that the government is not providing a clear-cut ‘green light’ for employment development despite the positive post-election messaging and associated planning reforms. Housing Minister Matthew Pennycook recently refused to grant planning permission for an employment park near Warrington because of concerns about Green Belt impact, being unconvinced of the need argument.

I&L developers and investors: how to approach planning promotions in 2025

Although the government has provided a more encouraging tone for the development industry, the lack of a nationally calculated need assessment continues to result in uncertainty. The Warrington Green Belt decision being a prime example of the need to support a promotion with robust market evidence. Therefore, our advice remains that the merits of a site and the ability to evidence demand are critical to test at site selection stage.  

For promotion of major I&L developments intended to meet regional/national/international need requirements, pursuing a robust Local Plan promotion alongside a planning application will provide the opportunity for demand evidence to be explored before a Local Plan inspector if the local authority is not persuaded. 

Finally, the relaxation of Green Belt policy (including Grey Belt) delivers areas of more promising planning potential than had previously been the case. Identifying previously developed land and understanding the extent to which land parcels contribute to the purposes of the Green Belt should be the starting point for those site searches.

Further information

Contact Geraint Jones or Victoria Button