The purpose of this study is to discuss the admissibility – in the light of the regulations and jurisprudence of administrative courts – of the location of retail parks consisting of several buildings, the total sales area of which exceeds 2,000 m2, in areas not covered by a currently binding local spatial development plan or covered by such local plan, which, however, does not explicitly allow for the location of such commercial facilities with a sales area exceeding 2,000 m2, hereinafter also referred to as “large format commercial facilities”, in a given area.
A retail park is to be understood as a retail and service complex consisting of several (at least two) buildings with premises accessible from the outside, and therefore without common internal communication routes (galleries), surrounded by a parking lot. These are, in particular, relatively small projects, the total sales area of which does not exceed 2,000 m2. Such projects have been among the most frequently implemented commercial investments for some time, especially in smaller urban centers or on the outskirts of large cities.
On November 11, 2015 the amendment to the Act on Spatial Planning and Development (“Act on Spatial Development”) entered into force, pursuant to which the provisions of Articles 10 sec. 3a and 3b were added. According to these provisions, the location of commercial facilities with a sales area of more than 2,000 m2 may only take place on the basis of the local spatial development plan, and therefore is not allowed on the basis of the decision on development conditions. It is worth emphasizing that this change was of an organizational nature, as it was a confirmation of a principle that had been shaped several years earlier in the jurisprudence of administrative courts. However, in accordance with the provision of Article 15 sec. 3 point 4) of the Act on Spatial Development depending on the needs, the local plan specifies the boundaries of the areas for the construction of large format commercial facilities. This provision is uniformly interpreted in the jurisprudence in such a way that the location of a large format commercial facility is permitted only in the area clearly designated for the construction of such facilities in a binding local spatial development plan, while it is not possible in the area designated only general for services and/or trade in the local plan.
The admissibility of locating a retail park consisting of several buildings, none of which has a sales area exceeding 2,000 m2, but their total sales area exceeds this threshold, in an area not covered by a local plan allowing for the location of a large format retail facility, will be determined by the answer to the question whether the above-mentioned buildings should, in the light of the provisions of the Act on Spatial Development be treated as one commercial facility or as separate commercial facilities. In the first case, their sales area will be added up, which will make it impossible to locate them in this type of area, and in the second case, such location will be possible. Therefore, the answer to the above question depends on the interpretation of the concept of a commercial facility.
Both in the Act on Spatial Development as well as the provisions of other laws, there is no definition of a “commercial facility”. The Construction Law only includes a definition of a “building object”, which is a building, structure or small architecture object together with installations ensuring the possibility to use it in accordance with its intended use. From this definition it follows logically that a building object cannot be a whole complex of several buildings and/or structures, but only each of these objects independently. On the other hand, the definition of “commercial facility” in the jurisprudence is derived indirectly from the definition of “sales area” contained in Article 2 point 19 of the Act on Spatial Development. Pursuant to this provision, the “sales area” should be understood as that part of the public area of a commercial facility constituting a technical and operational unit, intended for retail sale, in which goods are sold directly (without including the area of services and catering and auxiliary space which includes area of warehouses, offices, communication, exhibition space, etc.). The key element of this definition is the phrase “a commercial facility constituting a technical and operational unit intended for retail sale”. In connection with the above, the question arises whether the term “commercial facility” should be understood simply as a building object of commercial purpose, i.e. a single building or structure, or whether the legislator uses the term “technical and operational unit” meaning that the definition of a commercial facility distracts from the definition of a building object and a commercial facility can and should be understood more broadly – also as a set of several building objects linked technically (e.g. structurally) and operationally (functionally) in such a way that they co-create a larger whole. Such a whole would also include “building facilities” defined in the Construction Law as technical equipment related to a building object, ensuring the possibility of its use in accordance with its intended purpose, such as connections and installation devices, including those for the treatment or collection of sewage, as well as crossings, fences, parking lots and yards for garbage cans. In the justifications of some court judgments on this subject, there was a statement that the functional connection of several buildings justifying their recognition as a technical and operational unit occurs when the lack of one of them prevents the functioning of the others in accordance with their primary purpose, and this concept was logically distorted, as it was deduced that if in a complex of, for example, two commercial and service buildings, none of these buildings can function properly without their common technical and communication infrastructure, then each of them constitutes a technical and operational unit, not only with this infrastructure, but – somehow through the infrastructure – also together with the other building, although in fact each of these buildings could function properly without the other.
When assessing the planning requirements related to the sales area of buildings included in a multi-building retail park, using the first approach, a separate sales area for each building should be assumed, treating it as a separate commercial facility, while using the second approach, the sum of the sales area of all functionally related buildings should be considered, assuming that they constitute one collective commercial facility. The consequence of differences in the interpretation of the concept of a commercial facility is the formation of two contradictory lines of jurisprudence of administrative courts.
Examples of judgments shaping the first line of jurisprudence (one building – one commercial facility) are: the judgment of the Supreme Administrative Court (“Supreme Administrative Court”) of October 10, 2017, file ref. II OSK 2398/16 or the judgment of the Provincial Administrative Court (“WSA”) in Olsztyn of November 30, 2017, file ref. II SA / Ol 879/17. In the above-mentioned judgment of the Supreme Administrative Court of October 10, 2017, the court stated that the concept of “technical and operational unit” is derived from the Construction Law, in which it was used until mid-2015 when defining the concept of a building as one of the categories of building objects, and in the jurisprudence regarding this concept, the prevailing view was that the creation of a “technical and operational unit” by a given building / structure and related technical devices is not a necessary condition for recognizing such an object as a building object, which was particularly noted by the Constitutional Tribunal in its judgment of September 13, 2011, file ref. P 33/09. The Supreme Administrative Court decided that the above principle can also be transferred to the Act on Spatial Development and be applied to the interpretation of the concept of “commercial facility”. This leads to the conclusion that when determining whether a given facility is a commercial facility, and therefore a technical and operational unit, the relations between the considered facility (building/structure) and related installations and construction devices should not be taken into account, but only features of the object itself (e.g. a building) determining its independence (as a whole). Since infrastructure is not important for the assessment of a given facility as a technical and operational unit, the fact that several buildings have a common infrastructure cannot lead to the conclusion that they constitute one commercial facility within the meaning of the Act on Spatial Development. The Supreme Administrative Court also stated that the arguments for the fact that several buildings constitute a technical and operational unit, and thus constitute a single commercial facility, cannot be the fact that these buildings are included in a single application for a zoning decision, or that they are located on one plot, or real estate belonging to one entity.
According to the second line of jurisprudence (several related buildings – one commercial facility), represented by, inter alia, the judgment of the Provincial Administrative Court in Poznań of August 14, 2019, file ref. II SA/Po 88/19 or the judgment of the Provincial Administrative Court in Łódź of October 14, 2020, file ref. II SA/Łd 99/20, in the case of one investor designing an investment consisting of several structurally separate buildings of commercial function, served by a common technical infrastructure (utilities connections and devices) and communication (exits, internal roads, parking, squares), such a complex should be considered as technical and operational unit, and therefore for one commercial facility, the sales area of which, decisive for the possibility of its location in a given area, is the sum of the areas of individual buildings. In the above judgments, apart from the concept of “technical and operational unit”, the concept of “architectural whole” also appeared, which was due to the fact that in most cases covered by these judgments, structurally separate buildings, separated by fire walls or even by expansion joints, were adjacent to each other creating one “block”, and also had common architectural details emphasizing their relationship (eg uniform signs). Therefore – in the judgments regarding the issuance of a decision on development conditions for such projects – there was an argument that the authority issuing such a decision should focus primarily on architectural aspects as related to spatial order, and does not have to take into account strictly technical parameters, such as the nature of building partitions within one block, which could justify considering its parts as structurally separate buildings, as this belongs to the sphere of the subsequent procedure for issuing a building permit. Interestingly, in the last two cited judgments the courts responded to the applicants’ allegations based on the above-mentioned judgment of the Supreme Administrative Court of October 10, 2017 (from the first line of the case-law), not referring to the main line of argument contained in that judgment, but claiming that it concerned a specific, different case, because the buildings forming the commercial complex in the resolved case were located at a considerable distance from each other on a large plot (area of over a hectare).
The above jurisprudence shows that the issue of the method of calculating the sales area of multi-building retail parks, which determines the admissibility of their location in an area not covered by the zoning plan (based on a decision on development conditions) or in the area covered by the local special development plan that does not allow for the location of facilities with a sales area of above 2,000 m2 remains in dispute in the jurisprudence of administrative courts.
Nevertheless, in such cases, a lot depends not only on the local practice of architectural and construction administration bodies, but also on the specific architectural and legal solutions applied by the investor. The analysis of the available jurisprudence, as well as the decisions on development conditions issued in practice for this type of investment, allows for the formation of specific recommendations in the above scope for investors interested in building such facilities in such areas. Taking into account these recommendations may significantly increase the chances of obtaining a positive decision, as well as give it a greater possibility to defend it in the event of an appeal, and thus reduce the risk of revoking or annulment of such a decision.
If you are interested in the issues of locating commercial investments, do not hesitate to contact us.
Paweł Panek
Prawnik | Lawyer
T: +48 22 447 43 00
E: panek@millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield, and is based on the facts and guidance available at the time of its release which may be subject to change. The purpose of the publication is to draw attention to the legal events indicated in it and should not be the sole basis for any decision regarding a particular course of action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in individual cases. The services of a competent professional adviser should be obtained in each instance so that the applicability of the relevant legislation or other legal development to the particular facts can be verified.