Ended on the 18th March 2021
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Chapter 4: A Strong Economy

A Strong Economy

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Figure 4.1: Areas designated for office and industrial uses

4.1 Watford is a sub-regional economic centre, home to the UK headquarters of some well-known companies as well as many smaller local businesses. A short commute to central London means that Watford is strategically placed for business, although it remains a distinct and competitive economic centre in its own right.

4.2 Watford has a diverse economy, with a mix of office and industrial-based employment that reflects the multi-skilled community living in the borough. Information and communications technology based industries (ICT) are key employers in Watford, with professional services and knowledge based industries being its largest sector. Equally there is a strong industrial base in the borough, with five distinct industrial areas operating across a variety of different industries (Figure 4.1). This includes businesses related to storage, distribution and manufacturing.

4.3 Watford is also part of the South West Hertfordshire Functional Economic Market Area (FEMA) along with Dacorum, Hertsmere, St Albans and Three Rivers. Watford shares a strong relationship with its neighbouring areas, as demonstrated by the interlinked commuting flows.

4.4 The planning system can help to support the growth of Watford's economy by ensuring that the right type of land is available in the right places. The South West Herts Economic Study Update (2019) has identified a need across the sub-region for 188,000sqm of additional office floorspace and 481,500sqm of additional industrial floorspace. To contribute towards this requirement, Watford has planned for 111,175sqm of office floorspace and 40,759sqm of industrial floorspace. This means that there is an under-provision of industrial floorspace due to land availability, which is compensated for through an overprovision of office floorspace.

4.5 Providing more office floorspace than required for Watford can support our neighbouring authorities in meeting their need, provide high quality office floorspace to replace aging stock and reinforce Watford's role across the sub-region as an office hub. It also allows for new offices to be provided at the most sustainable locations, as Clarendon Road allows for the benefits of its proximity to Watford Junction to be maximised.

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4.6 The policies in this chapter seek to encourage further economic growth by supporting increased provision and intensification of employment floorspace, including industrial (Figure 4.2).

4.7 COVID-19 has greatly impacted the economy to date, with the full, long-term effects upon employment remaining relatively unknown. The policies have been designed to continue to support business investment and development in Watford, whilst also being sufficiently flexible to allow for any potential transformative impacts. This may include increased flexible and home working. There is also the potential for an economic recession which could lead to a period of high unemployment and vacancy before any long-term recovery.

Strategic Policy EM4.1: Providing New Employment

Proposals for new employment floorspace will be supported where they contribute towards meeting the identified employment need in the borough and Functional Economic Market Area.

To meet these challenging targets, the Local Plan will seek to prevent the net loss of both office and industrial floorspace across the Borough. New office growth will be prioritised at the Clarendon Road Primary Office Location, while new industrial growth will be prioritised in the five Designated Industrial Areas. Over the plan period, the Council will seek to plan for the creation of 11,500 new jobs.

The Council will continue to work with neighbouring authorities in the South West Hertfordshire Functional Economic Market Area to deliver the shortfall of industrial floorspace that cannot be provided in Watford over the plan period.

The Council will seek to support sustainable economic growth in the borough and the wider Functional Economic Market Area where possible by:

  1. Protecting existing employment land from inappropriate development;
  2. Encouraging the growth of new businesses and industries;
  3. Supporting new models and ways of working, including more flexible working practices;
  4. Ensuring employment land is intensified to make the most effective use of land; and
  5. Attracting new inward investment.

Designated industrial areas

4.8 Watford contains five industrial areas, which host a wide variety of businesses, from large warehouses for storage and distribution, to smaller workshops. These industrial areas are vibrant during the day time and vacancy rates are low. Yet as the demand for housing grows, so too will the number of jobs required in Watford. A key issue facing the borough is that the identified need for new industrial land is met with a limit in land supply. The South West Herts Economic Study Update has shown there to be a large demand for industrial floorspace within the plan period, although the borough's Housing and Economic Land Availability Assessment (HELAA) (2021) has identified a shortfall of land for industrial uses up to 2036.

4.9 This shortage has been exacerbated by large scale losses of floorspace over recent years. In Watford, industrial floorspace has seen a net loss of 24,657sqm between 2007 and 2018. Evidence shows that these losses have often been to residential uses, which enjoy higher land values and have been subject to conversions through Permitted Development Rights. There have also been losses to other non-employment uses that generate few jobs, such as bulky retail units and community spaces that are better suited to other locations. These losses, combined with high future demand for industrial land, mean that protecting and intensifying designated industrial areas will play an important role in meeting future industrial growth requirements. Sites within designated industrial areas that have scope to be intensified have been identified as part of the Housing and Economic Land Availability Assessment.

4.10 While any new industrial floorspace could be dispersed across the borough, the colocation of industrial uses in a designated area can have benefits. Although evidence shows productivity is higher when industry is clustered, there are some more practical advantages of consolidating designated industrial areas. The noise, vibration and odour often caused by industrial processes can make it more sensible to locate these industrial uses together, as opposed to dispersing them directly amongst residential and office uses.

4.11 Uses that would be considered inappropriate in designated industrial areas are destination uses that do not complement the existing industrial uses in the area. These destination uses generate specific trips to the industrial areas that are not related to the employment offer on site. For example, some retail uses such as showrooms may attract customers to the industrial area, but cannot be used by the employees on site on a daily basis. These types of uses can undermine the effectiveness and value of the employment area to Watford's economy and are better suited to other locations.

4.12 Some non-industrial uses can support the function of the designated sites, making a valuable contribution to the area. These uses can be referred to as supporting uses, or 'walk to' uses, reflecting their strong relationship with neighbouring businesses. Providing small facilities under 100sqm in size such as fitness gyms, nurseries, some retail units and cafés can complement existing uses by providing facilities that can frequently be used by staff working in the employment areas while also creating jobs. Offices may also support the industrial function of some businesses in the site, although larger premises will be subject to Policy EM4.3 'Office Development'. Existing office in the Designated Industrial Areas can retain the same use, but will be encouraged to intensify where possible.

4.13 Development should also have regard to the Waste Local Plan and the identified Employment Land Areas of Search (ELAS) which overlaps with some of the sites in the Local Plan.

Industrial potential supply 2018-2036Square metres
Site allocations17,035
Sites with planning permission23,724
Total40,759

Policy EM4.2: Designated Industrial Areas

Designated industrial areas are identified on the Policies Map.

Proposals for new industrial employment uses will be supported where they contribute to the identified need for industrial land set out in the South West Herts Economic Study Update. To achieve this, proposals will be supported that incur no net loss of industrial floorspace unless:

An up to date evidence base demonstrates that the site is no longer required for industrial use; or

The property has been vacant for at least 12 months and there is clear marketing evidence to show it cannot be reused or redeveloped for industrial use in the medium term.

Proposals for supporting uses under 100sqm will be supported where their job generating potential can clearly be demonstrated. This should be assessed on a case by case basis. Proposals for supporting uses must show that the development proposed would not compromise any industrial or other employment activities in the designated site in terms of their continued efficient function, access, service arrangements and operating times.

Office development

4.14 The professional service industry is the largest sector of employment in Watford and accounts for 14% of employment, with these types of businesses often being office based.

Office potential supply 2018-2036

Floorspace (sqm)

Site allocations

38,672

Sites with planning permission

72,503

Total

111,175

Table 4.2: Future office floorspace supply

4.15 The majority of Watford's offices are clustered around Clarendon Road, which functions as Watford's central office district. The draw that Clarendon Road has across the sub-region is reflected in the South West Herts Economic Study Update, which emphasises the strategic role that the area plays in the Functional Economic Market Area. The provision of office floorspace in the Local Plan is set out in Table 4.2.

4.16 The Housing and Economic Land Availability Assessment has shown that the vast majority of new office growth in the plan period can be met at Clarendon Road. There are many economic and environmental benefits of concentrating Watford's office growth at this established office location. Developing an intensified office cluster will help sustain Clarendon Road as an eminent and distinctive office location, with an increased focus on sustainability and high quality design. Ensuring that Watford's offices are grouped at Clarendon Road would also help retain its vibrancy, whilst enjoying the benefits of agglomeration.

4.17 The area sits within the Watford Gateway section of the Core Development Area, which is set to be an area that will experience some transformative change during the plan period. Potential exists to redevelop sites within the Clarendon Road office area and intensify land use to ensure that office growth requirements are met. This includes high density development and taller buildings.

4.18 Similar to designated industrial areas, some smaller, supporting or walk-to uses of under 100sqm may also be considered appropriate, where they support the office function of the area. This may include cafés or convenience stores for employees to purchase lunch, hot drinks or other everyday items. Residential uses will also be supported in the area, to create a vibrant, mixed use quarter. However, any mixed use development should be office led to ensure that the quarter retains its key office function.

4.19 To preserve the strong sub-regional role that Clarendon Road plays in supporting growth in the office sector, the area will be the preferred location for future office growth. It is important to protect existing office use at this location, in line with the findings of the South West Herts Economic Study Update. For proposals for new office floorspace, the office development hierarchy should be followed (Figure 4.3). The approach aims to direct new office development to the Clarendon Road Primary Office Location. If it is not possible for the new office to be located within the Clarendon Road Primary Office Location, the sequential test should be used to direct the office use to the wider Core Development Area, in line with the office hierarchy. This ensures than new office use outside of Clarendon Road contributes to small clusters first, to minimise any potential negative impacts on residential or industrial areas elsewhere.

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Policy EM4.3: Office Development

The Clarendon Road Primary Office Location is located on the Policies Map.

Proposals for new office development that result in no net loss of office floorspace in the Clarendon Road Primary Office Location will be supported. Proposals that would incur a net loss of office floorspace will be resisted unless:

  1. An up to date evidence base demonstrates that the site is no longer required for office use; or
  2. The property has been vacant for at least 12 months and there is clear marketing evidence to show it cannot be reused or redeveloped for office use in the medium term.

Mixed use development, including residential, will be supported where there is no net loss of office floorspace and a predominantly commercial frontage is maintained on to Clarendon Road.

Proposals for development of new office uses outside the Clarendon Road Primary Office Location must support the Office Development Hierarchy. Where these are 250sqm (gross) or more, they must also be accompanied by an Impact Assessment. Assessments will need to demonstrate there will be no significant adverse impact on the office function of Clarendon Road, and that good accessibility by walking, cycling and public transport is provided or available.

Proposals for supporting uses under 100sqm will be supported where their job-generating potential can clearly be demonstrated. This should be assessed on a case-by-case basis.

Economic development outside of designated employment areas

4.20 The Watford Employment Land Review (2019) has shown that losses of B (employment) class floorspace have been most prevalent in non-designated employment locations. This has largely been through changes to residential uses through permitted development and other means. These losses remain in conflict with the need to increase floorspace to support Watford's economic growth to meet the identified need set out in the South West Herts Economic Study Update. Whilst the majority of employment growth is expected to come through the redevelopment and intensification of designated sites, the designated industrial areas and the Clarendon Road Primary Office Location, smaller non-designated sites also have the potential to assist in supporting Watford's economy.

4.21 In the first instance, new offices should be directed to the Clarendon Road Primary Office Location and industrial uses to the Designated Industrial Locations. However, the loss of existing offices and industrial sites should be avoided to ensure that viable employment sites are not lost to other uses. The policy seeks to protect the employment offer outside of designated employment areas to address recent losses of B (employment) class floorspace.

4.22 Changes in the market may mean that some sites are no longer viable for employment use and either lie vacant, or are better suited for another use. In these circumstances, changes of use should be enabled to ensure that the most effective use of land is being pursued.

Policy EM4.4: Economic Development Outside Designated Employment Locations

The net loss of existing employment floorspace outside designated industrial areas or the Clarendon Road Primary Office Location will only be permitted where:

  1. An up to date evidence base demonstrates that the site is no longer required for employment use; or
  2. The property has been vacant for at least 12 months and there is clear marketing evidence to show it cannot be reused or redeveloped for employment use in the medium term; or
  3. The job generating potential of the alternative proposed use can clearly be demonstrated; or
  4. The proposal achieves clear sustainability objectives, such as the provision of residential development in close proximity to key public transport nodes.

Different ways of working

4.23 One of the impacts of COVID-19 to date has been the move towards more flexible working practices. This includes a rise in home working for those who are able to do so. This change in working culture may spell an increase in demand for different types of premises.

4.24 Small and medium-sized enterprises (SMEs) dominate the working base in South West Hertfordshire and account for 99.6% of all businesses and 50% of employment. This means that there may be a greater demand in Watford for smaller, non-traditional workspaces. This issue was also raised during the preparation of the Local Plan, where public consultation identified the need for the provision of more flexible workspace, as well as more start up and incubator units for small businesses. The demand for more communal office facilities to be provided as part of new development was also highlighted as part of the public consultation.

4.25 Creative industries are a fast-growing sector in South West Hertfordshire and providing the right types of spaces could support their growth. The Cultural Strategy (2019) highlights the need to improve the range of facilities for creative industries, which could strengthen Watford's cultural offer. This could include the provision of exhibition or studio space on the ground floor of new developments or in stand-alone spaces.

Policy EM4.5: Different Ways of Working

Development proposals for new forms of workspace including flexible workspace, start-ups, micro businesses and space for social and cultural enterprises will be supported across the borough where there is demonstrated to be no significant harm to the amenity of neighbouring land uses.

Training, skills and professional development

4.26 It is important that when new development comes forward, this benefits local people. Development contributions are sought to ensure that new development provides the required infrastructure to support the current and future needs of the community. These contributions, such as Section 106 contributions, can be used to fund social infrastructure, such as opportunities for training and professional development. Although the labour force in Watford is considered to be highly skilled, there exist opportunities to help address social inequalities by offering opportunities to those seeking apprenticeships or further training. This could be during the construction phase of new development or in the completed development itself.

4.27 There are high levels of deprivation in parts of the borough, including the fifth most deprived area (LSOA) in Hertfordshire. This is often linked to income deprivation, which can be exacerbated by unemployment and lower levels of education. Supporting apprenticeships or training schemes would seek to capture the social value of new development.

4.28 New development can also support local businesses in Watford by ensuring that fair tender opportunities are given to local small and medium-sized enterprises and social enterprises, and that local businesses are used in the developer's supply chain.

4.29 The process for providing these employment and training initiatives will be set out in a Supplementary Planning Document. Applicants will be required to provide a training, skills and employment strategy to demonstrate their contribution.

Policy EM4.6: Training, Skills and Professional Development

The Council will work with its partners and use development obligations to require major developments to provide appropriate employment and training initiatives for local people.

To achieve this, major development proposals will be required to submit a training, skills and employment strategy, in agreement with the council, which demonstrates:

  1. Training programmes and apprenticeships provided on new development sites and / or as part of new development;
  2. Fair tender opportunities offered to local small and medium-sized enterprises and social enterprises; and
  3. Opportunities offered to local businesses in their supply chains.
To take part in these consultations, you will first need to register as a user by clicking on the link at the top right of this page. Once you have registered, select a document, then comments can be given by clicking on the pen icon and writing in the form that appears. For further assistance please read our help guide.
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