If the Regs are applied correctly, the allowance for lost floorspace (i.e. demolition) is applied automatically. The key to it is the formula in Reg 40(6) - Cr x (C - E) / C where Cr is the GIA of (in this case) the dwellings or the resi care home, C is the total GIA of the chargeable development, and E is the GIA of the pub and hotel being demolished. So this formula is run twice, once for the dwellings and again for the resi care home, to arrive at the deemed net area A (Reg 40(5)) on which CIL is chargeable at the chargeable rate R for each, prior to adjusting for the affordable units which does not appear to be the issue here. Re the last sentence, this only becomes an issue if the GIA of the pub and hotel being demolished is greater than the GIA of the chargeable development, in which case no CIL is due.
