Development Land
Whether you are buying or selling land for development, you must understand your obligations and rights and those of the other party. Other Commercial Property areas we cover include:
Fill in the contact form and we will get back to you shortly.
Get on contact and we will arrange a no-obligation callback at a time to suit you.
1
2
3
I consent to Tinsdills contacting me via:
A Trusted Team For Development Land Issues
Issues can arise if the sale contract terms are not sufficiently clear or have been drafted too narrowly/widely.
Development Land is quite often sold and purchased using one of 3 contract structures:
   1 – Unconditional Sale/Purchase
   2 – Option
   3 – Conditional Contract
Unconditional Sale/Purchase
With this structure, the parties agree to complete the sale/purchase at a predetermined price on a fixed date. There is no conditionality attached to the sale/purchase.
Option
An Option is a contract between a seller and a potential buyer.
The Option gives the potential buyer the right to call for the land to be sold to them at a future date. The price may be agreed upon at the outset or be determined by the terms of the Option. Quite often, but not always, the potential buyer will have various obligations and conditions they must satisfy before being entitled to exercise their rights under the Option.
An example of where an Option might be used is as follows:
A buyer (B) wishes to purchase land from a seller (S). B intends to build and sell 20 houses on the land. The land does not currently benefit from planning permission, and neither S nor B knows whether planning permission will be granted.
S does not wish to fund a planning application.
S does not wish to accept a price reflective of bare land as he believes the land has development potential.
B does not wish to buy the land if he cannot develop it.
In the above scenario, the parties may agree that B is entitled to exercise his right to buy the land once planning permission has been obtained. At that point, the price will be determined using a calculation agreed upon in the Option (e.g., a percentage of the market value of the land with planning permission).
Depending on the bargaining strength of the parties, the seller may demand an initial fee to enter into the Option.
A potential buyer may prefer to enter into an Option (as opposed to an Unconditional Sale or Conditional Contract) because it allows them to have the security of knowing that they can call for the land to be sold to them but that there is no compulsion on them to do so.
Conditional Contracts
A Conditional Contract is similar to an Option in many ways. The fundamental difference is that, unlike an Option, if the relevant conditions of the contract are satisfied, the buyer is obliged to buy. A seller may prefer to enter into a Conditional Contract (as opposed to an Option) because it provides more comfort due to the obligation on the buyer to purchase.
Why Tinsdills is the legal team for you
Ranked top 10 out of more than 11,500 solicitor firms in the UK.
Would recommend to friends and family
Satisfied with outcome of matter
Get In Touch To Discuss Your Development Land
We pride ourselves on tailoring our advice to our client’s needs, and we are happy to offer a range of fee structures to best suit our clients and the transactions being undertaken.
Get in touch today for more information on this and more regarding Development Land.
Our phone lines are open Mon to Fri: 9:00 am – 5:00 pm.
Alternatively, please fill in the form above, and one of our experts will contact you as soon as possible.
Contact us today or visit a local branch
Hanley:
01782 262031
Newcastle:
01782 612311
Sandbach:
01270 761111
Leek:
01538 399332