Landowners – Land under Option Agreement

Under a typical Option Agreement the developer would pay the landowner an option fee upon exchange and then promote the land through the planning system for development. The developer would normally be required to maximise the development potential and minimise the obligations, restrictions and payments to the local authority under the planning consent, thus achieving the optimum land value.

If planning is obtained, the Option Agreement normally permits the developer to purchase the land at a price reflecting the current open market values less the agreed option discount. It is not uncommon at this stage for there to be a difference of opinion with regards to the land value as the landowner would be looking to identify as high a market value as possible while the developer would be looking to identify as low a market value as possible.

At Kalotec we specialise in working with landowners and their appointed agents to secure the best possible value for their land. With our wealth of experience and understanding that comes from a background of working for national housebuilders we can provide a valuable insight into how a developer handles these types of land value negotiations. Using our bespoke in-house appraisal system we can calculate the open market value for any development land based on a developers approach using current market rates and commercial returns.

Call us today for more information and to arrange your free no obligation initial meeting.

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