Report of the Planning and Development Director.
The Sub-Committee considered a report of the Planning and Development Director which set out options for updating policies to ensure there was sufficient accommodation to meet the growing visitor numbers.
Members were informed that the approach in the current Local Plan had encouraged hotels in appropriate locations and the clustering of hotels particularly near the Tower of London and around the St Paul’s area had been encouraged. This followed on from work undertaken in 2009 which looked at hotel need and demand. Since then, the policy had delivered hotels in appropriate locations and enabled many older buildings, particularly listed buildings to continue to be used as these buildings were often more suitable for hotel use and could be more easily divided into bedroom sized spaces rather than open spaces for office use.
An Officer stated that it had been expected as a result of the covid pandemic, that demand would decrease. However, there had been significant demand for new hotel development in the City. This demand had been largely driven by hotel chains in Europe. Hoteliers and developers had seen post-covid demand was returning. This fitted in with the Destination City approach. The potential demand would be considered in more detail to plan the approach rather than allow pepper-potting. People visiting the City increased footfall and enlivened it and they should be provided with opportunities to stay in the City. It was also recognised that business travel was returning.
A hotel study had been commissioned from Avison Young. They had looked at the significant growth of hotels in the City over the last 10-15 years. There had been a 41% growth in hotels and 51% growth in hotel bedrooms. This was largely in 4* hotels or limited service hotels (hotels which provided clean and comfortable ensuite facilitates, 24 hour reservations and a consistent level of facilities). There had also been growth in hotel chains for those with smaller budgets.
The hotel study had suggested that the increase in office space and increased demand from businesses was driving future hotel demand, as was Destination City and the increased footfall in the City, the impact of the Elizabeth Line and demand from a range of hotel brands, operators and developers for new facilities. The hotel study had estimated demand of an additional 350 hotel bedrooms per year up to 2037. This would equate to one large or two smaller hotels per year. The study also looked at whether there was any need to cluster as hoteliers favoured clustering. The areas looked at were the east of the City, around Tower and Smithfields, with the growth in that area including the museum and the future reuse of the market. These were both considered good locations for hotels.
The Officer informed Members that the first policy option was to continue with the existing approach to allow hotels as they came forward on an ad hoc basis and leaving it up to the market to decide rather than encouraging a range of hotel types. Whilst the market was generally supportive of this approach, this approach did not give the emphasis the Destination City programme was looking to provide and would not provide emphasis that the City was an area where businesses were encouraged to bring staff for work purposes and an area where visitors could come and stay.
The Officer informed Members that the second policy option was a more positive, forward-looking approach which more specifically encouraged hotel development. Hotels were less constrained than other uses e.g. in terms of daylight and sunlight expectations, as guests were not in their rooms for as long. The presence of hotels had minimal impact on the office and commercial market. Hotels were not constrained by the same noise and amenity considerations as they would be if there were residential buildings nearby. This meant they could be delivered across wider areas of the City, particularly in older buildings including Grade B buildings which had difficulties in meeting EPC standards. This approach would include a target which would probably be an indicative target over a 10-year period rather than an annual target. It was also suggested that the approach could require a range of hotels with a range of facilities and the hotels should be open and out-facing, welcoming visitors and not just hotel guests. Where appropriate rooftops should be opened, with public access to the rooftop views and facilities. The Officer stated that in schemes approved in recent years, cultural and community space had been negotiated within hotels to encourage these types of space and these complemented the Destination City work.
Members were informed that Officers recommended the second, more positive approach.
The Chairman commented that hotel room demand was increasing year on year and whereas this demand used to be overspill from the West End, people were now actively searching for City sites. The Chairman also stated that a major hotelier was seeing the City as a destination and looking to increase rooms in the City. The Chairman also advised that the Destination City team were working on schemes to encourage business travellers to extend their business trips for leisure purposes. This would increase footfall and spending on local amenities.
The Chairman suggested having hotels around terminal and major sites such as the Tower of London could be beneficial. He and other Members raised some concerns about clustering within the City. He suggested that a steer be given in the Local Plan without this being too defined.
A Member commented on the potential to convert offices that were no longer suitable for use as offices. He also commented that it was important that hotels enlivened the City where possible and raised concern that where hotels provided a range of internal amenities, hotel guests would not use the local restaurants and shops. A Member commented that in some cases, there had been a need to restrict public access to internal hotel amenities.
A Member requested that public toilets should be provided in any hotels with public access.
A Member outlined a number of old buildings which had been returned to hotel use. An Officer commented that the number of listed buildings which lent themselves to hotels with the City, and were unsuitable for offices, was an untapped potential and there were heritage benefits.
The Chairman stated that one the challenges of heritage assets was reaching net zero. In response to questions, an Officer stated that the nature of a building dictated its performance in terms of carbon. Hotels had different profiles from offices in relation to demand for heating and cooling and more water was used in hotels. In relation to floor plans, hotels could have smaller rooms, designed in a flexible way, whereas for offices, there was generally a demand for larger floor plates. The report recommended allowing an increase in change of use from office to hotels in certain circumstances. This would help with the retention of some existing buildings as they could be converted to hotel buildings on a economically viable basis. Both heritage buildings and some newer buildings could be suitable for the change of use.
RESOLVED - That Officers continue to progress work on the City Plan based on Members’ views on the proposed policy direction in relation to the policies on hotels and visitor accommodation.