Adding Value with Planning Permission
20 March 2023
Local Planning Authorities are required by the Government (Planning and Compulsory Purchase Act 2004) to identify land within their administrative boundaries that will meet the needs for future housing and employment growth.
Not all development can be brought forward on brownfield land as there is simply not enough available or suitable sites to meet housing targets. This means that in some locations, greenfield land, land in the Green Belt or with other designations such as an Area of Outstanding Natural Beauty will have to be identified for development. Local authorities will assess the available sites and decide which locations are most appropriate and necessary for future development. These sites are known as strategic sites.
To aid the process of identifying the most suitable land, Land Promoters partner with Landowners to bring forward development opportunities and present these to the local planning authorities followed by the preparation of detailed development schemes that can deliver on housing, employment secondary and primary schools, medical facilities and infrastructure.
Land Promoters provide the required expertise and funding to navigate the planning system to secure permission and, if successful will then receive a share of the sales proceeds following disposal of the land. The arrangement between the parties is most likely to be secured by way of a Promotion Agreement. This is a very different agreement to an Option Agreement, which is the preferred mechanism for some parties in the development industry. A Promotion Agreement provides the comfort to the Landowner that they are achieving the best value for their land, as it is in the Landowners and the Promoters interest to secure the highest sale value for the land.
The added benefit of planning permission increases the land value substantially enabling Landowners and investors to make significant gains.
With thanks to our contributor, Joseph Hayes, Land Director at Ptarmigan Land, a leading Land Promoter.