An option agreement is one means of realising the development potential of rural and brownfield sites. It is a contract that seeks to balance the objectives of the landowner and developer in releasing property for development - too much control for one hampers flexibility or security for the other.

Implementation of this type of agreement is usually dependent on planning permission and other service or building conditions for the developer being met. For landowners, the key can be in selecting the developer most likely to deliver - not necessarily the one willing to offer the highest price. There are also alternatives to the standard development option, which may provide a better return.

The financial structure to each deal is different. Imaginative schemes can increase the reward for the landowner, improve the developer's cash flow or save tax for both parties. In the current economic climate the ability to look to the long term is particularly relevant.

The owner needs to know he can deliver possession to the developer when all the other conditions are satisfied. It can be tricky to achieve this when agricultural leases are in place.

Developers therefore need advisers who can protect their interests through the different stages of the project - acquisition, planning and onward sale or lease. Our extensive experience of acting for developers and landowners helps focus the commercial sharpness of our advice.

For more information please contact Fiona Gibb.