Strategic Land and Promotion Agreements
Our Property team have expert knowledge and extensive experience of dealing with strategic land transactions (acting for both landowner or developer) and therefore are perfectly placed to help you with the sale or purchase of land for development under a long term strategic arrangement.
We regularly act for developers and landowners on both large and small scale strategic development agreements to allow sites to be successfully promoted through the local planning framework and achieve planning consent for residential development.
Our straight forward and practical advice allows us to quickly reach the commercially important parts of these complex transactions which produces excellent results for our clients; whether they be developers or landowners.
There are different forms that a ‘strategic land agreement’ can take, including –
Option Agreement with a variable purchase price which could be based on either:
– A percentage of the market value of the land once planning consent has been obtained; or
– A fixed sum per Developable Acre of land; or
– A fixed sum per residential unit (to be constructed on the land).
Promotion Agreement, where an experienced developer or land promoter promotes land for development (and secures planning consent) and then the land is sold on the open market and the promoter and land owner share in the sales proceeds.
Collaboration Agreement, where two or more landowners or developers work together with achieve a larger scale development by including various parcels of land in the site for development. This will often involve an equalisation provision between the parties so that all parties receive an appropriate percentage of the total sales prices equal to the size of the land which they are bringing to the collaboration.
Or it may be that an arrangement is an amalgamation of some or all of the above!
By their very nature strategic land agreements will be bespoke to the terms agreed between the parties and therefore it requires a full understanding of the potential issues and ways to resolve these; which our specialists are able to provide.
In addition to the form of agreement itself, there are also other things to consider when dealing with such specialist agreements and arrangements, including Overage Arrangements.
Our extensive experience of dealing with such matters enables us to give pragmatic advice and, where necessary, reach compromises which are acceptable to both parties and still achieve the overall aim of obtaining the maximum development from the land.
- We recently acted on a land acquisition for two national developers of a development site in Alton, Hampshire for 275 houses. We acted for the developers in respect of the negotiation of the option agreement approximately four years before the planning permission was achieved and the land acquired. We also acted on a collaboration agreement for the two developers and the infrastructure agreements to allow the development to be constructed.
- We acted for a regional developer who took a long term option over a site west of Oxford which included a promotion agreement style arrangement, whereby if the developer didn’t exercise the option agreement then the land would be sold on the open market and the developer would be repaid their planning costs together with a percentage of the sale price. Planning consent was obtained for half of the site (an option agreement remains in place for the remainder of the land) and was sold on the open market to a national developer. We acted in collaboration with the landowner’s Solicitors and negotiated the necessary contract and transfer provisions to enable the other half of the site to be developed in the future.
- We are also acting for a farmer landowner near Guildford, Surrey, who has entered into a long term option agreement with a developer, who has recently achieved planning permission for 240 houses. This will be a major development and we are currently actively involved with the landowner ensuring that they receive all the necessary advice and the matter is brought to a successful conclusion.
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Sand Martins Golf Club have recently completed the successful acquisition of a parcel of land with the assistance of Herrington Carmichael and in particular, solicitor Lauren Ainsley. We found working with Lauren a pleasure. During the entire process Lauren was thorough, informative, diligent and very professional as she acted on our behalf. It was a pleasure working with Lauren and we would highly recommend her services.
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