Residential development acquisition

Shoosmiths’ housebuilder team, led by Steve Wiltshire, worked with award-winning client, Baker Estates Limited, on the purchase of the third of six phases of a development in Dartmouth for nearly 500 dwellings, plus commercial development (including a care home).

The land identified for development on the edge of Dartmouth in the South West was held under a suite of options by a local promoter and there were five different landowners involved in the deal. There was also a historic landowner who briefly owned part of the site and who had the benefit of a complicated phased overage arrangement. And to make it even more sophisticated, there was a network of planning consents covering the site divided into two principal consents for two large phases, the first won on appeal. The SDLT implications of unpicking the overage and option arrangements that were released by the beneficiaries on a piecemeal basis gave food for thought for Dan Kennedy, a partner in our tax team.

Added complications included:

• that the only access to the site was over a piece of unregistered and unadopted land;
• that one of the landowners wanted to have his three pieces of land acquired by way of a series of ‘put and call’ options exercisable in different tax years;
• the need to charge the land as each phase was acquired to the client’s funder, which required providing rolling certificates of title to the lender; and
• that much of the land was going to need to drain over further third-party land, meaning a complicated easement arrangement needed to be put in place to benefit each phase of land as it was being acquired.

It also did not help that the two main landowners did not get on and would not sit in the same room together, as well as that there were seven sets of third-party lawyers to corral throughout the transaction!