Developers borrow nearly £10m to convert offices about Milton Keynes rail station to 200 new flats

The money enables the company, called Permitted Developments Investment No 13 Ltd, to buy the block of offices directly above the station after their 18 month battle to get planning permission.

The offices will be converted into flats in a controversial scheme that failed to get approval from MK Council.

Despite the council's concerns about lack of parking and the "poky" size of the proposed flats, the aptly-named company won planning permission under the governments 'permitted development rights' rules.

Because Whitehall has changed the rules to allow such conversions under these development rights, the council did not have grounds to decline the change of use.

The developers will now convert three storeys of the block to flats, mainly small one-bedroom units to be marketed as ideal for commuters.

This week a lending firm called Pluto Finance announced it had completed a £9.7 million bridge loan for the purchase of the building.

A Pluto spokesman said: "The 12-month bridge facility will enable the acquisition of the Station House site, which comprises a five-storey building, main station concourse and ticket office of Milton Keynes train station, a ground floor retail parade and four upper storeys of office space.

He added: "The property has planning permission in place to convert the existing office space into 200 residential units, whilst retaining the ground floor station and retail space. In a prime position, once developed, Station House will be ideal for local workers as well as commuters into London, with a 30-minute journey time.

Justin Faiz, Partner of Pluto Finance, told the Citizen: "This was a complex agreement, including the purchaser’s acquisition of a company and a number of long leases to be considered. However the loan credit was approved and funded within four weeks with the entire team coordinating from home.”

MK Council leader had previously described the developer's proposals for Station House as "genuinely appalling" and slammed such schemes for creating "poky flats"..

Before the planning appeal last summer, he said: “I don’t often comment on planning matters but this scheme is genuinely appalling, not only because of the poor size of the flats and the lack of parking, but the long term damage to the possibility of regenerating Station Square. I hope the applicant reconsiders because I think we need to fight this, and I hope our MPs understand this is the result of the awful planning rules on allowing office space to be converted into low quality flats.”

No resident parking is proposed as part of the development, but 182 lockable storage units for cycles will be provided instead.

Permitted Development Investments No 13 Ltd was incorporated in April last year. Its directors are Jeffrey Mark Weinzwig, whose correspondence address is in the Bahamas, and Mark Richard Shooter, who lives in London.