It is a question that comes up regularly in viability disputes: when guidance says an alternative use value must be ‘implementable’, does that mean the AUV scheme must already benefit from planning permission?
In our view, the answer is no.
That is not because planning status is irrelevant. Far from it. But the real test is wider. The question is whether the alternative us is a credible, deliverable option for the site, not whether it already sits behind an extant consent. The Planning Practice Guidance allows AUV to be informative when establishing benchmark land value, but only where the alternative use would fully comply with up-to-date plan policy, could be implemented on the site, is supported by market demand, and is justified by evidence on the costs and values of that use.
That wording matters.
‘Implementable’ is not the same as ‘already permitted’. In some cases, the alternative use may not require a fresh planning permission at all. In others, it plainly will. Where a permission would be needed, the absence of one is not automatically fatal, but it does mean the party relying on the AUV must show, with evidence, that the use could realistically secure consent and be delivered in practice.
The appeal decisions help draw that distinction:
In Highbury Quadrant Congregational Church, Islington (APP/V5570/W/21/3277196), the inspector accepted an AUV approach because the suggested refurbishment route was examined as a real-world alternative. The inspector looked at whether the scheme complied with policy, whether it could be physically delivered, whether there was demand for the refurbished community space, and why it had not been pursued by the landowner. The exercise was firmly rooted in deliverability, not in the formal existence of a planning permission.
By contrast, in Land to the rear of 83-85 High Street, Esher (APP/K3605/W/20/3248698), the inspector was not persuaded by part of the appellant’s AUV case because the proposed alternative commercial car park had no planning permission, sat in a sensitive heritage setting, lacked sufficient detail, and had not been shown to be policy-compliant or genuinely deliverable. The absence of planning permission was relevant, but what really undermined the argument was the failure to show that the alternative could actually be implemented.
That is the key point for practitioners.
The more prudent reading of the guidance is that ‘implementable’ is a deliverability test. It requires evidence that the alternative use is capable of happening in the real world. That usually means addressing:
- Policy compliance.
- Whether planning permission is needed and, if so, the likelihood of obtaining it.
- Physical and technical feasibility.
- Abnormal and conversion costs.
- Market demand.
- A clear explanation of why the alternative use has not been pursued.
It is also worth remembering that where AUV is used, the guidance is explicit that the landowner premium is already included and must not be added again.
So, the short answer remains: an AUV case does not always need an extant planning permission. But where permission would be required, the party advancing that AUV must do the hard work of showing that the alternative is not merely imaginable, but realistically deliverable.
That is the approach most likely to withstand scrutiny in negotiations, at committee and on appeal.
