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Richard Mays, partner at Andrew Jackson Solicitors, heads the firm’s Development & Strategic Projects team, a twelve strong team of lawyers who specialise in real estate transactions with a strategic dimension, and where the team can add value with its end to end project support.
In his latest article, Richard looks at a few “easy wins” for developers when his team can be involved in a development project at an early stage.
Being involved in a project from day zero means that we can play a more positive and proactive role in assisting with the planning, direction and delivery of the project and with the early identification of issues that may have an adverse impact on the project. It also means that we are integrated into the project from the start, with a strong understanding of the detail, allowing us to suggest solutions or ways of managing risk.
Illustratively, three simple but “easy win” ways in which we can assist in the early lifecycle of a project are:
- undertaking a site legal health check
- helping to create a workable structure for the project and
- giving “tips” for things which are often overlooked in the initial “feasibility assessment stage”
Site Legal Health Check
Unless the site has only been recently purchased, and purchased with the full nature and intention of the project in mind, then a site legal health check covering title, matters affecting property and other peculiarities of the site is pretty much an essential first step for the developer.
This process will identify not only troublesome or problematic restrictions, but also rights and third party interests affecting the site and which might sterilise use or development of part of it. In addition, it is important to make sure that the designed solutions for access to the site and drainage and services for the scheme are all possible to achieve, from a legal standpoint.
We find that a site visit, undertaken as part of the site legal health check, is also useful at this stage. Walking the perimeter and the terrain helps us more easily to identify different points of interest and/or concern, which may not be evident from the paper title (such as gates, windows etc), but may still have legal status and may affect the ability to implement a desired layout.
Having a workable and legally acceptable structure for a project is also one of the imperatives.
For example, a development that mixes both commercial and residential elements, particularly one including leasehold flats, needs a structure and approach, which addresses properly the impact of the rights of the first refusal enjoyed by owners of certain leasehold residential premises, under the Landlord and Tenant Act 1987.
When deciding upon the structure for any scheme, end users, investors and funders will need robust and convincing explanations of the legal basis if they are to be expected to accept something novel or an approach that does not reflect one of the more typical structures with which they are familiar.
With our experience of different options as to how to structure a transaction, we can help clients to understand how those options might work in their project and to find the right direction of travel for it.
The team’s ability to offer advice on the different tax treatment of different structures is also a bonus for clients in these early stages of a project.
Being forced to make significant changes to the structure of a project during its lifespan is often fraught with difficulty and may even have the potential to derail it, so our expertise in large-scale strategic projects can be of a great benefit to clients and their projects.
Feasibility Assessment Stage
Too often we find that, in this early stage of a project, a developer will overlook something that it would do as a matter of course, and without question, further down the line.
A good example of this is where the developer fails to make sure that, when engaging professionals for early feasibility work, the professionals will, if required further down the line, give warranties or letters of reliance to end users and investors in respect of their services.
This omission by a developer can leave the developer as a “hostage to fortune” if the services given by the professional turn out to be important to the scheme, or if they have to be relied on by the contractor and other professionals with the impact that there is then, in effect, a gap in protection for the end users and investors.
Ideally, we like to be invited to attend project meetings throughout the life of a project because that allows us even more scope for contributing as part of the larger team and increases the value that we add to the project through the delivery of our services.
These are just a few “easy wins” for a developer, but they do illustrate how the end to end, longer term involvement in project of the Development & Strategic Projects team at Andrew Jacksons Solicitors can be important in the successful delivery of that project.