Chesterfield developer will not have to pay £230,000 levy on eye-catching apartment project

As previously reported, James Holmes had been in a long-running standoff with Chesterfield Borough Council (CBC) over the Community Infrastructure Levy owed on his renovation of the former North East Derbyshire District Council (NEDDC) offices on Saltergate, intended to help fund the parks, roads, flood defences, schools, healthcare and other public goods relied on by the building’s new residents.

The issue persisted for so long that the original 2021 planning permission expired with little sign of the site returning to use. Permission was granted for a second time in 2025, when the council reasserted that the levy still applied at an estimated maximum of £229,355.28, payable before work could begin.

A recent flurry of activity on site signalled there had been some movement in the stalemate over the levy - but the council has confirmed it is no longer due as Mt Holmes has been able to prove the premises have been used as office space in the intervening period.

Mr Holmes declined to answer questions related to the levy but has provided a progress update on the project, saying: “The windows are all in and the building is effectively weathertight. That wasn’t one of the biggest jobs, or the biggest financially, but it is symbolic.

“It’s now full steam ahead and we hope to have the first ten flats finished by the end of September, and tenants in by mid-October.”

The saga stretches back to 2015 when NEDDC vacated the building, and 2018 when another developer was granted permission to demolish the building for an all-new apartment block.

When Homes by Holmes came forward with alternative plans in 2021, it was determined that 38 of the apartments were smaller than minimum standards so could not be treated as permitted development to an existing building, making the plans liable for the levy of around £253,092.

Both that figure and the 2025 calculation above are top-end estimates based on planning documents for the internal floorspace of the development and the levy rate at that time – which stood at £66.15 per square metre in 2025, when the apartment sizes and overall floorspace had also been altered.

In short, if Mr Holmes could show the building had been in use for its designated purpose – as an office – for six months within the previous three years, then it would be considered as a site which had already accounted for local infrastructure needs.

A spokesperson for Chesterfield Borough Council, said: “We have been in ongoing discussion with Mr Holmes about his long-standing development plans for this building to be converted into housing.

“After the submission of additional evidence by the developer, the Community Infrastructure Levy position on this development has now been resolved and there is no infrastructure levy payment associated with the development.

“This evidence demonstrated that part of the building had been in lawful use for the required period of time so that the existing floorspace should be offset against the CIL liability. This offsetting reduced the CIL liability to zero.”

To prove lawful use Mr Holmes would be required to submit evidence such as lease agreements, utility bills and business rates valuations.

Asked by the Derbyshire Times, neither Mr Holmes nor the council would disclose the identity of any business or organisation which occupied the building during the qualifying period.

The installation of some 72 EPC-compliant windows over the summer has satisfied one other planning condition, as it includes newly created openings to ensure 11 of the apartments will comply with legally required levels of natural light, meaning Mr Holmes can press ahead with the rest of the project.

Mr Holmes said: “We are now awaiting a new electricity substation coming in September, doing the final wiring so that it’s all ready by then and putting all the stud walls up. The rear entrance will be ready by the time the first tenants move in.

“We’re also repointing all the red brick exteriors to soften its appearance, because it looks too office-y at the moment. That alone is costing around £50,000.

“The rest of the flats should become available in two phases, and hopefully everything done by about May next year.”

The avoided levy should perhaps be assessed in light of the overall finances for the project too.

Mr Holmes said: “I’m working with the bank at the moment to get the next tranche of money to move the project on, and convince them that Chesterfield is a good town to invest in.

“I’m probably up to about £4.3million in development costs so far, including the purchase price, and it will be nearly £6m by the time it’s finished. That’s more than I thought in 2021. Covid really affected costs and there has been a lot more inflation since and I’m borrowing a lot based on equity in other projects.

“At the end of the day, the world progresses through entrepreneurs like me, borrowing £6m, taking a 25-year risk, while people at the Town Hall push their pens and paper around and mess about with all their nonsense.

“The council can think what they want. Council officials don’t mean much to me. All these things cause delays, and people like me have had enough in the UK.”

Another planning application is expected soon for demolition of an outbuilding on the site and other external alterations being considered for the boundary wall and landscaping.

The CBC spokesperson said: “We will continue to engage and support with Mr Holmes with the delivery of his development and look forward to seeing this prominent building brought back into use for the benefit of local people.”