Large-Scale Residential Planning Post-SHD

The Strategic Housing Development (SHD) system meant proposed housing schemes of more than 100 homes, or student accommodation of 200-bed spaces, could bypass local authorities and apply for planning permission directly from An Bord Pleanála. The system was intended to speed up the development process and fast-track housing delivery. However, the process has become largely ineffectual, with 48 percent of all homes granted permission in the first six months of this year now subject to judicial review and resultant delays. With SHD’s ‘retirement’ date now set, the future of residential planning looks set to be markedly different from the past few years.

The SHD fast-tracking process was spearheaded by the Minister for Housing, Simon Coveney, and considered controversial from its launch in 2016. Despite the number of house completions rising by 21,000 (pre-covid-19), the system has ultimately been deemed unsuccessful, failing to live up to expectations, with many developers opting to sell sites instead of developing upon them after receiving planning permission from An Bord Pleanála.

For these reasons, the SHD process has been scrapped by the Irish coalition government, with a phasing out period from October 2021 until February 2022 for final applications. After that date, developers will once again have to apply to local authorities for planning permission before deferring decisions to An Bord Pleanála.

What Went Wrong with SHD?

When the SHD process was announced, An Bord Pleanála hired 17 members of staff to handle applications and appeals in its Marlborough Street office in Dublin 1. By the summer of 2017, they began accepting applications. The purpose of SHD, the Department of Housing insists, was always to expedite the process of planning decisions. With an average decision time of 14.5 weeks, the dedicated team at An Bord Pleanála seems to have achieved that.

Nevertheless, the overarching goal was to simply get more houses built, with planning decisions only the first stage in that process. According to An Taoiseach Micheál Martin, despite a massive number of application decisions being made, the amount of construction that followed, as a result, was disappointingly low, with only 36 out of 117 applications actually undertaking work. While a lag between the application approval and the construction is typical, the Department of Housing found that by 2019, only half of the applications from 2018 and 2019 had begun, indicating something else was afoot.

Opposition politicians have claimed that the lack of development is due to strategic land hoarding and trading of sites once permission has been obtained, which does of course happen, but perhaps not to the extent claimed.

In 2019, a group was tasked to review the SHD process and that group made recommendations to An Bord Pleanála to rescind permission if applicants did not start work within a certain amount of time. This proposed change never came about, with some concerned it would damage the longer term delivery of large housing projects impacted by viability issues and more recently by Covid-19.

Post-SHD, developers will be able to use 30 percent of the permissioned land for commercial use. This is double the original cap and could make some apartment projects more viable with commercial ground floors.

New System

These changes are only possible because the real estate sector successfully lobbied to extend the SHD process from the planned three years to five. Many within the industry would have liked to see SHD a permanent change, albeit with some modifications.

However, with Fianna Fáil and the Green Party insisting the system is phased out by December 2021, SHD is now being replaced with a new system with built-in time limits on application decisions.

The new system includes the following time-frames:

• 8 weeks for local councils to conduct planning consultations

• 8 weeks for local councils to make an application decision

• 16 weeks for An Bord Pleanála to handle any appeals

This 32-week system is 7 weeks longer than the current SHD process, leaving some unhappy with the changes.

With the deadline looming, many developers are rushing to put in applications before the new system is launched next year. While planning applications can be submitted up until February 2022, consultations with An Bord Pleanála need to be submitted by December.

Local Councils Regaining Some Powers

With some powers such as water services, waste collection, and vehicle tax being taken out of the hands of local authorities in recent decades, the handing back of development decisions bucks this trend of centralisation. The main appeal of the reversal is that local councillors have knowledge of the area that housing developments were proposed for. Over the course of the SHD system’s lifetime, there were concerns that  An Bord Pleanála did not have sufficient local knowledge of areas to deal with the requests appropriately. These concerns are echoed by the Department of Housing’s assessment, which admits that local authorities are better positioned to understand the impact of large-scale housing developments. The Association of Irish Local Government has also welcomed the return of regional powers, claiming housing developments should be sustainable.

Thankfully, despite opposition lobbying for height caps to be reinstated, there is no indication this particular change will be reversed.

Catering to Local Communities

In Dublin alone, there have been 183 SHD applications, with 117 of them permitted to proceed. These applications will eventually lead to an increase of 30,000 homes in Dublin, including 19,000 apartments, 8,000 rentable units, and 7,800 student digs. With so many build-to-rent properties in the pipeline, this leaves just 3,100 actual homes for purchase planned. This has led to some concern over the lack of affordable housing being built.

The Department of Housing’s hope is that by giving local communities a greater voice in the process, it will reduce the number of judicial court reviews of housing development applications.