Charities can become ‘inadvertent' landowners as a
result of gifts and legacies, as well as through active investment.
These gifts can be valuable if the land turns out to have
development potential. However, holding land will not always enable
a charity to profit from potential development. The expertise to
promote land for the purpose of obtaining planning permission will
usually need to be harnessed.
There are a number of ways in which charities can benefit from
development value whilst minimising the costs and risks involved in
obtaining planning permission. These include:
- entering into a ‘promotion agreement' with a
promotor, who will apply for planning permission and pay the
professional fees and costs associated with doing so. Once planning
permission has been obtained, the proceeds of sale will be split
between the charity and promotor in pre-agreed proportions;