Change of use (Art. R. 151-27 of the Planning Code): the authorisation on which the new use of an asset depends

An office building acquired at a discount, a ground-floor retail unit vacant for eighteen months, an office floor whose tenant will not renew: in each of these cases, the exit value depends less on the acquisition price than on the legal ability to use the asset differently. Yet that ability is not limited to a prior declaration (déclaration préalable) filed at the town hall. It results from the layering of at least four bodies of rules: the destination within the meaning of the French Planning Code (code de l'urbanisme), the use within the meaning of the French Construction and Housing Code (code de la construction et de l'habitation, "CCH"), the destination of the building as set by the co-ownership rules (règlement de copropriété), and the permitted-use clause of the existing lease. One of these four layers is enough to block the operation, or to push back its timetable by several years. This guide sets out each of them, how they fit together, and the checkpoints to build into an acquisition audit or a conversion strategy.

Destination within the meaning of Article R. 151-27 of the French Planning Code

Five destinations, twenty-one sub-destinations

Decree No. 2015-1783 of 28 December 2015, which came into force on 1 January 2016, recast the nomenclature applicable to local urban planning plans (plans locaux d'urbanisme, "PLU"). Article R. 151-27 of the French Planning Code now recognises five destinations:

• agricultural and forestry operations
• housing
• retail and service activities
• facilities of collective interest and public services
• other activities of the secondary or tertiary sectors

Article R. 151-28 breaks these destinations down into sub-destinations, the content of which is specified by the order of 10 November 2016, as amended by the order of 31 January 2020 made pursuant to Decree No. 2020-78 of the same day. It is at this level that the operational categories sit: dwelling and accommodation for housing; crafts and retail trade, catering, wholesale trade, service activities receiving customers, hotels, other tourist accommodation and cinema for retail and service activities; industry, warehouse, office, conference and exhibition centre and kitchen dedicated to online sales for other activities of the secondary or tertiary sectors.

This structure produces a counter-intuitive consequence, central for the investor. Office and warehouse fall within the same destination. Converting an office floor into a logistics warehouse is therefore not, strictly speaking, a change of destination. By contrast, converting a dwelling into a tourist residence moves the premises from the housing destination to the retail and service activities destination: this is indeed a change of destination subject to authorisation.

Transitional law: which nomenclature actually applies

PLU drawn up or revised before 1 January 2016 that have not opted for the new nomenclature continue to operate with the nine destinations of the former Article R. 123-9 (housing, hotel accommodation, offices, retail, crafts, industry, agricultural or forestry operations, warehouse, and constructions and installations necessary for public services or of collective interest). Under that former body of rules, moving from offices to warehouse was a change of destination subject to a formality.

The first audit reflex is therefore to identify the date of approval of the applicable planning document and the nomenclature it uses. An analysis carried out under R. 151-27 when the applicable rules still reason in nine categories mechanically leads to an error of classification, and therefore to an offence.

Destination and use: two separate regimes, cumulative, not interchangeable

Use within the meaning of Articles L. 631-7 et seq. of the CCH

Destination falls within planning law: it is attached to the building, enforceable against everyone, and checked against the PLU. Use follows an entirely different logic, that of protecting the housing stock. Article L. 631-7 of the French Construction and Housing Code makes a change of use of premises intended for housing subject to prior authorisation in municipalities of more than 200,000 inhabitants and in the municipalities of the départements of Hauts-de-Seine, Seine-Saint-Denis and Val-de-Marne, other municipalities being able to join the system by resolution.

The text uses a decisive reference date:

Premises are deemed to be used for housing if they were assigned to that use on 1 January 1970.

Evidence of this historical use is built in practice from the H2 model tax declaration, cadastral records, earlier leases or any contemporary document. Retail premises operated as such for decades but declared as housing in 1970 remain legally housing within the meaning of the CCH: marketing them as business premises will require a change of use authorisation, where applicable accompanied by compensation.

A second structuring point: Article L. 631-7-1 of the CCH provides that the change of use authorisation is personal, except where it is made subject to compensation, in which case it is attached to the premises and passes with them. A buyer who takes over an asset operated as offices on the basis of a personal authorisation inherits nothing: the authorisation ceases to have effect when its beneficiary ceases the activity. Overlooking this distinction in a due diligence turns marketable premises into constrained housing.

Layering the regimes on the same premises

For Parisian housing premises that one wishes to use as offices, three separate authorisations may be required: the prior declaration or building permit for the change of destination under planning law, the change of use authorisation under the CCH, and, where applicable, the approval of the general meeting if the co-ownership rules require it. None of the three exempts from the others. The refusal of any one is enough to defeat the operation.

Short-term furnished letting concentrates this layering. It falls within change of use under the CCH once it goes beyond the framework of the main residence, it may amount to a change of destination under planning law where it comes with para-hotel services, and it is now exposed to the co-ownership lever. Law No. 2024-1039 of 19 November 2024 aimed at strengthening the tools for regulating furnished tourist lettings increased the powers of municipalities (quotas, extension of the authorisation regime, temporary authorisations) and gave the general meeting, in buildings exclusively intended for housing, the power to prohibit the letting of furnished tourist accommodation by an enhanced majority. For an investor who values a residential asset on a short-term yield, usability therefore now depends as much on a general meeting vote as on public law. The three locks that condition the operation of furnished tourist accommodation, registration, change of use and co-ownership, are analysed in our article on securing this type of asset.

Which formality for which change

The authorisation regime is read from the interplay of Articles L. 421-4, R. 421-14 and R. 421-17 of the French Planning Code.

• A change of destination without works, or with works that affect neither the load-bearing structures nor the façade, falls under the prior declaration (Article R. 421-17).
• A change of destination accompanied by works altering the load-bearing structures or the façade of the building falls under the building permit (Article R. 421-14).
• A change of sub-destination within the same destination is not, in itself, subject to a formality as a change of destination.

This third point calls for a warning. The absence of a formality does not mean lawfulness. The PLU rules may, on the basis of Articles R. 151-30 and R. 151-33, prohibit certain destinations and sub-destinations or make them subject to specific conditions. Office premises converted in fact into a warehouse in a zone where the warehouse sub-destination is prohibited are in an irregular position, even if no declaration was required as a change of destination. Fit-out works, loading bays, façade alterations or the intensification of traffic flows moreover almost always reintroduce a formality in respect of the works.

The procedural timetable is then read as a decision timetable: one month for examination of a prior declaration, three months for a building permit other than for individual houses, extensions where the Architecte des Bâtiments de France (architect of historic buildings) is consulted or where the building is open to the public, an administrative withdrawal period of three months (Article L. 424-5), a period for third-party appeals of two months from continuous display on the site (Article R. 600-2), and an obligation to notify the appeal to the beneficiary and to the author of the decision (Article R. 600-1). The authorisation is valid for three years, extendable twice by one year (Articles R. 424-17 et seq.). No serious bank financing is released before the appeal period has fully expired and the certificate of no appeal has been produced.

The real obstacles: hierarchy of blocking points

The PLU, the first filter

The destination sought must be permitted in the zone. Beyond an outright prohibition, three mechanisms commonly block conversions.

The first is the protection of commercial diversity. Article L. 151-16 of the French Planning Code allows the PLU to identify streets or areas in which commercial diversity must be preserved, by laying down requirements intended to prevent changes of destination of ground-floor premises. This is the main lock on retail-to-housing conversion projects at the foot of a building: the unit is vacant, unsellable as retail, and yet legally frozen in its destination.

The second is the reverse: some rules require, in central zones, the retention of business activities or offices, or cap the share of housing. The third lies in accompanying rules, parking, outdoor space, minimum dwelling sizes, which make a destination that is permitted in principle physically unattainable.

Conversely, Article L. 152-6 of the French Planning Code authorises, in municipalities located in a high-demand area, reasoned derogations from the PLU rules, in particular for the conversion to mainly residential use of an existing building, as regards massing, density and parking obligations. This power is discretionary: it is negotiated before the application is filed, with the planning department and the elected official in charge, and not by litigation once a refusal has been notified.

The co-ownership rules and the destination of the building

The administrative regime says nothing about the relationship between co-owners. Premises may be perfectly authorised under planning law and yet barred from use by the co-ownership rules.

Articles 8 and 9 of Law No. 65-557 of 10 July 1965 give the destination of the building a measuring function: restrictive clauses are lawful only if justified by that destination, and Article 43 treats as unwritten those that are not. In practice, the distinction between a simple residential clause (clause d'habitation bourgeoise simple), which tolerates the practice of professions, and an exclusive residential clause (clause d'habitation bourgeoise exclusive), which prohibits it, governs most of the trade-offs. It is accepted that an exclusively residential clause prevents the setting up of a commercial or professional activity, even if authorised by the PLU.

Two majority rules then frame the operation. Works affecting the common parts or the external appearance of the building fall under the Article 25 majority, with the Article 25-1 fallback. By contrast, the general meeting cannot, by any majority, impose on a co-owner a change in the destination of his private parts, and a change in the destination of the building itself requires unanimity. For an investor who holds one or more lots in an older building, reading the rules and their published amendments comes before the planning study, and not the reverse. The applicable majority regimes and the cases in which unanimity is required are set out in our article on the amendment of the co-ownership rules.

An often neglected angle: conversion changes the criteria for apportioning service charges. Moving from offices to housing changes the objective usefulness of shared services (lift, heating, caretaking) and may justify a revision of the charge shares (tantièmes), a source of disputes with the co-ownership association (syndicat des copropriétaires).

The permitted-use clause of the lease and the tenant's exit cost

As long as a commercial lease is running, the contractual destination takes precedence over any wish to convert. The tenant is bound only by the permitted-use clause of the lease, which is strictly construed.

Where it is the tenant who asks to change its activity, two regimes apply. Partial change of use (déspécialisation partielle) under Article L. 145-47 of the French Commercial Code allows it to add related or complementary activities, provided it serves notice of its intention on the landlord by extrajudicial act (acte extrajudiciaire), the landlord having a period in which to dispute the related or complementary nature. Full change of use (déspécialisation plénière) under Articles L. 145-48 et seq. requires a request made by extrajudicial act; the landlord's silence for three months amounts to acceptance. Article L. 145-50 reserves to the landlord an indemnity compensating the loss resulting from the change of activity. On the landlord's room for manoeuvre to refuse, negotiate or frame the request, see our analysis of the change of use of a commercial lease.

On the institutional landlord's side, two consequences deserve to be weighed together. A change of use is a modification of the destination of the premises, an element of rental value within the meaning of Article L. 145-33, capable of justifying the removal of the cap on the renewal rent under Article L. 145-34. A tacit agreement arising from the absence of a reply within the three-month period causes the loss of both control over the activity and the properly documented argument for removing the cap.

Where it is the landlord who wishes to convert, the question becomes financial. Refusal of renewal gives rise to the eviction indemnity (indemnité d'éviction) under Article L. 145-14, the amount of which, based on the value of the business, frequently exceeds the expected gain from the conversion. The right of recovery to build or rebuild under Article L. 145-18 offers an alternative route, at a different indemnity cost but under strict conditions. In a distressed real estate case, the tenant's exit cost is the first variable of the model, before the cost of works.

Office-to-residential conversion: what one inherits by changing destination

Office-to-residential conversion moves the asset from one regulatory regime to another, and this transfer is rarely built into financing plans.

A tertiary building falls under the Éco Énergie Tertiaire scheme arising from Decree No. 2019-771 of 23 July 2019 and codified in Articles L. 174-1 et seq. of the French Construction and Housing Code, with staged consumption reduction obligations and an annual declaration on the OPERAT platform. Once converted into dwellings, the same building leaves that scheme but enters the timetable of Law No. 2021-1104 of 22 August 2021 known as the Climate and Resilience Law: a ban on letting dwellings rated G since 1 January 2025, dwellings rated F from 1 January 2028, and dwellings rated E from 1 January 2034. An operation that reaches a D rating after works has secured its usability; an operation that stops at E carries a capex obligation by 2034, which is negotiated today in the price.

To this are added the technical issues that determine feasibility: floor depth and access to natural light, acoustic constraints, vertical networks, asbestos removal, fire safety compliance. An office building classed as a public-access building (établissement recevant du public) ceases to be one once it becomes housing, which eases certain constraints but creates others. It should be recalled that, where the operation requires a building permit, the permit also serves as works authorisation under the public-access building regulations pursuant to Article L. 425-3 of the French Planning Code: the two examinations are not conducted separately.

For tax purposes, a change of destination that generates taxable floor area triggers the development tax. In Île-de-France, the tax on the creation of premises used for offices, retail and storage provided for in Article L. 520-1 of the French Planning Code applies to the creation of offices: converting offices into housing does not trigger it, but the reverse operation, often contemplated on residential assets at the foot of a building, must take it into account.

Securing the existing destination before acquiring

The reference destination is the one that results from the last planning authorisation lawfully issued and implemented. For older buildings without a title, it is the actual use that prevails, which has to be proved. An asset operated as offices for twenty years without any declaration ever having been filed is in breach, and that breach passes with the building.

Two mechanisms mitigate the risk without erasing it. Article L. 421-9 of the French Planning Code prohibits, once ten years have passed since a building was completed, challenging its compliance with a view to refusing a new authorisation, subject to the exceptions it lists. Prosecution of the offence of carrying out works without authorisation, punished by Article L. 480-4 of the French Planning Code, is time-barred after six years. But the authorities retain other levers, and above all: an irregular destination weakens any later application, complicates financing and is an immediate negotiating point for an informed buyer.

The acquisition audit must therefore include, at a minimum, the following:

• the complete chain of planning authorisations, completion declarations and certificates of non-challenge of compliance
• an information or operational planning certificate under Article L. 410-1 of the French Planning Code, adapted to the intended project
• proof of use on 1 January 1970 for any premises likely to fall under the CCH, and the instrument of any change of use authorisation, with verification of whether it is personal or attached to the premises
• the co-ownership rules and all their published amendments, the descriptive statement of division and the last three minutes of general meetings
• the existing leases, their amendments, the change-of-use deeds and any correspondence that may amount to tacit agreement by the landlord

These checks must be reflected in the deed: conditions precedent of obtaining authorisations free of any appeal, seller's representations and warranties on the regularity of the destination and use, an escrow allocated to the identified risk, and an implementation timetable tied to the real examination and appeal periods.

Conclusion

Destination within the meaning of Article R. 151-27 of the French Planning Code is only one of the four locks that govern the usability of an asset. In practice, it is almost never the hardest to open: the decisive obstacle most often lies in the co-ownership rules, in the eviction cost of a protected tenant, or in a personal change of use authorisation that does not survive the sale. Treating conversion as a planning question is the costliest methodological error in this area.

Our position is as follows: the feasibility of an office-to-residential or retail-to-residential conversion is determined in the opposite direction to intuition, starting from the lease and the co-ownership rules and working back up to the PLU. Before making a firm offer on an asset acquired for its discount, have a cross-cutting feasibility note prepared covering these four levels, and expressly make completion of the sale conditional on obtaining all the authorisations, free of third-party appeal and administrative withdrawal. The additional cost of this audit is out of all proportion to that of an asset that is legally frozen in its original destination.

Frequently asked questions

Does a change of destination without works require authorisation? Yes. Article R. 421-17 of the French Planning Code makes the change of destination of an existing building subject to a prior declaration, even in the absence of works, where one moves from one of the five destinations of Article R. 151-27 to another. If the works accompanying the change alter the load-bearing structures or the façade, a building permit is required under Article R. 421-14. The examination period is one month for a prior declaration, three months for a building permit other than for an individual house, subject to extensions linked in particular to consultation of the Architecte des Bâtiments de France.

What is the difference between change of destination and change of use? Change of destination falls under the French Planning Code: it is attached to the building, assessed against the PLU, and checked by the municipality's planning department. Change of use falls under Articles L. 631-7 et seq. of the French Construction and Housing Code: it protects the housing stock in municipalities of more than 200,000 inhabitants and in Hauts-de-Seine, Seine-Saint-Denis and Val-de-Marne, residential use being assessed as at 1 January 1970. The two regimes are independent and cumulative: obtaining one never exempts from the other.

Is converting offices into a warehouse a change of destination? Under the nomenclature resulting from the decree of 28 December 2015, no: office and warehouse are two sub-destinations of the same destination, other activities of the secondary or tertiary sectors. No formality is required on that ground alone. It is nevertheless necessary to check that the PLU rules do not prohibit or condition the warehouse sub-destination in the zone, on the basis of Articles R. 151-30 and R. 151-33, and that the planned works do not themselves trigger an authorisation. If the applicable PLU still falls under the former Article R. 123-9, the answer is reversed.

Can the co-ownership rules prohibit a conversion that the town hall has nonetheless authorised? Yes, and this is common. An exclusively residential clause prevents the commercial or professional use of a lot, regardless of any planning authorisation. Such clauses are valid only if justified by the destination of the building, Article 43 of the Law of 10 July 1965 treating as unwritten those that are not, but challenging them requires litigation whose outcome and timetable are uncertain. The general meeting also cannot change the destination of a co-owner's private parts, whatever majority is obtained.

Does the change of use authorisation pass to the buyer of the premises? Not as a rule. Article L. 631-7-1 of the French Construction and Housing Code provides that the change of use authorisation is personal and ceases to have effect when the beneficiary's activity comes to a definitive end. It is attached to the premises, and therefore transferable, only where it was made subject to compensation. Any due diligence on housing premises used for business must therefore produce the instrument itself, and not a mere certificate of actual use.

Does an existing commercial lease prevent the conversion of the building? It conditions it financially. The tenant is protected by the right to renewal, and refusal of renewal gives rise to the eviction indemnity under Article L. 145-14 of the French Commercial Code, calculated mainly on the value of the business. The right of recovery to build or rebuild under Article L. 145-18 is an alternative route, regulated and also involving an indemnity. In a conversion project, this exit cost must be assessed before the offer, because it often determines the profitability of the operation on its own.

How should an asset operated for years without a change of destination authorisation be treated? Two periods limit the risk without removing it: the six-year limitation period for prosecution of the offence under Article L. 480-4 of the French Planning Code, and the rule in Article L. 421-9 which prohibits, once ten years have passed since completion, refusing a new authorisation on the ground of the initial irregularity, subject to statutory exceptions. In practice, an irregular situation weakens financing, insurance and any later application. Regularisation by filing a declaration or a permit, before putting the asset on the market or before acquisition, remains the safest route and is negotiated in the price.