In recent press reports, developers have been accused of separating social housing tenants from wealthier home owners by preventing them from using play areas.
Most developers remain keen to conserve cash. Developers are increasingly looking into schemes that do not require much up front cash. These schemes often involve the developer providing land and/or buildings rather than cash.
For example, a developer may agree to redevelop Council land. The consideration may take the form of the developer providing new affordable housing or community facilities such as a sports centre.
We have been involved in numerous such schemes over many years. They are often highly complex. In our experience it is essential that the parties have a clear idea of what they are trying to achieve and how they propose to achieve it. In current terminology, they should have a road map. Otherwise, the principles may get lost in the detail, delaying the project.
It is important to agree the legal structure at an early stage, before detailed drafting begins. The structure should be set out in clear (non-binding) heads of terms, ideally with a structure chart or diagram. It should be set out in plain English rather than legal drafting.
The parties should take tax and accounting advice on this structure.
People are often keen for draft contracts to be circulated, as a sign that progress is being made. In our experience it is well worth taking the time to agree the structure and to document it in simple terms. This can save huge amounts of time and expense in the long run.