Retain permission to develop when granting a long lease?

Retain permission to develop when granting a long lease?

15:00 PM, 12th November 2018, About 6 years ago 11

Text Size

I jointly own with one other individual the freehold of a property via a ltd company. The property comprises of three flats on long leases ( 999 years) and a separate integral self contained garage and separate Garden that is not directly accessible from any flat.

The garage and Garden are not on separate leases, but belong to the freehold. An issue arises if either of us wishes to sell our flats as a share of freehold, as a sale of share of freehold would automatically transfer the interest in the Garage and Garden with it which has issues for us, both in terms of being able to find buyers prepared to pay the extra premium for a part share of these areas ( it is in a good area of London) and also if we wish to hold the garage/garden longer term with an eye to development potential.

The solution as we see it is to grant separate grant long leases on the Garage and on the Garden to us, the current freeholders, allowing the individual flats to be sold as share of freehold. A secondary question arises given the potential of the Garage / Garden for development value – when granting leases to the garage / garden, is there any way within the leases we grant ourselves to guarantee the rights of the leaseholders to be able to develop the Garden/ Garage without being blocked by the new freeholder or needing to pay a premium in the case that the flats are sold and new freeholders are introduced?

Are there any other solutions to these conjoined questions, aside from selling the flats as leasehold and retaining the freehold?

Many thanks for any thoughts on the above.

Max


Share This Article


Comments

Kate Mellor

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

20:48 PM, 21st November 2018, About 6 years ago

Max if you and your co-owner are the current freeholders of the entire plot within a company and the other (council) leaseholder of the third flat doesn’t have a right of way over the area in question, it is not shown as common area for use of the leaseholders and the plan for the third lease doesn’t incorporate any of the relevant area then why do you need to enshrine the development rights? To do so you would need to amend all three leases, the tenant of one is unlikely to agree as they have no incentive to do so.
If you amend the plans for the existing two leases that you and your co-owner currently own To exclude the “development site” and create a third lease jointly owned you could then sell the leases on the flats whilst retaining full ownership of the freehold in your company and therefore the potential to develop the garden/garage.
We have a similar dilemma ourselves in that we own the freehold of a leasehold development along with 5 of the six leases. We also wish to develop a suitable area of the freehold.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership

or

Don't have an account? Sign Up

Landlord Automated Assistant Read More