Option Agreements – Purchasing Land

Imagine a developer identifies a plot of land he or she believes has significant future development potential, but obtaining planning may not be guaranteed. The developer may be apprehensive about buying the land, but they would still want an interest in the land to give sufficient security in order to outlay planning costs. Similarly, landowners with a parcel of land suitable for development may wish to obtain planning on their land to realise planning potential, but they would not want to pay the planning costs themselves. What are the strategies that can be employed by both landowners and developers to assist in such land deals?

Option Agreements

A developer and a landowner can enter into an Option Agreement, which gives the developer the option to purchase the land (usually at and agreed sum, or at market price less pre-agreed deductions) and the ability to obtain planning, without the risk that they will be compelled to acquire a parcel...