A legal challenge to the Government’s decision to relax planning rules for conversions of office to residential premises has been lost.

The challenge - led by Islington, and supported by Richmond and Camden councils, with a separate action brought simultaneously by Lambeth Council - sought to overturn the Government’s decision to relax planning rules which allows automatic conversions of office to residential premises with no need for planning consent.

Last week, Mr Justice Collins dismissed the claim for a judicial review after the councils brought joint action against the revised general permitted development order the Government introduced in May.

Richmond Council cabinet member for environment Councillor Pamela Fleming said: “We are hugely disappointed by this decision – the changes to planning laws will weaken business and investment opportunities in Richmond.

“Supporting our local economy is at the heart of what we do at the council which is why we launched this joint legal challenge in the first place.”

The legal challenge centred on the way the Government handled the process for seeking exemptions from the new permitted development rights, which the boroughs argued was unfair.

In his judgment Mr Justice Collins understood the concerns which led to the claims by the boroughs and said “the lack of any requirement for affordable housing is worrying”, but ruled the Government’s actions were not unlawful.

The councils raised concerns over losing valuable employment space, jobs and undermining economic prosperity as well as the quality of housing created if planning permission is not required.

Richmond Council has received more prior notification of this change in use than any other authority in the country.

To date the council has received 130 prior approval notifications with those approved so far resulting in 20,000sq m of office space lost.