When acquiring a property for development, covenants that restrict the type or form of development always need to be carefully considered. There are a number of ways in which restrictive covenants can be addressed, and in two recent cases developers sought to have the relevant restrictive covenants discharged following the grant of planning permission.

The

Introduction

Reform of the regime governing residential long leaseholds (leases of dwellings for a term of twenty one years or more) has been going on for over fifty years.  The latest reform is to restrict a landlord’s ability to charge ground rent on top of an initial premium paid on the grant of the lease.  Ground rent is a sum the tenant pays annually, in addition to the lump sum for the lease itself.  Unlike insurance rent and service charges which the tenant must also pay, ground rent is seen as an ongoing windfall for the landlord, as it is not referable to provision of a service.

Continue Reading Leasehold Reform (Ground Rent) Act 2022

Last week the UK Government published its long-awaited proposals for reform of the planning system in England and Wales, in the Levelling-Up and Regeneration Bill.

Back in June 2020, radical reforms to the planning system were proposed, including introducing zoning and deemed planning permission in designated growth areas.  Despite the abandonment of these far-reaching reforms, the proposals set out in the Bill, are significant.  The main changes are as follows.

Central Government will take a much greater role in planning

This will be achieved by the introduction of a new suite of National Development Management Policies which will set out generic planning policies applicable across the country.  Local Plans will be expected to restrict themselves to purely local issues.  The expectation is that this will provide greater consistency in decision-making and help with the speedy production of up-to-date Local Plans.  This is backed by a new statutory provision to the effect that applications are to be determined in accordance with the Local Plan and National Development Management Policies and if there is a conflict between the two, national policies will prevail.

This is a significant cultural shift from the position to date under which locally-determined policies should prevail.  There is also some scepticism about the production of a whole new suite of national policies: is this a return to the days of PPGs which were swept away on the grounds that these were too unwieldy and bureaucratic?

Continue Reading Levelling Up and Planning Reform

The tragic events in Ukraine have caused Western governments to take various steps to cause economic damage to the Russian state, Russian companies and Russian nationals. In coordination with other governments, the UK Government has imposed escalating sanctions, which we are tracking here.

As part of this approach the UK Government has also brought forward the publication of the Economic Crime (Transparency and Enforcement) Bill (the “Bill”) – indeed Prime Minister Boris Johnson said that “There is no place for dirty money in the UK. We are going faster and harder to tear back the façade that those supporting Putin’s campaign of destruction have been hiding behind for so long. Those backing Putin have been put on notice: there will be nowhere to hide your ill-gotten gains.”

Continue Reading The new economic crime bill – greater transparency of property ownership in the UK?

The Chancellor of the Exchequer Rishi Sunak delivered the Autumn Budget for 2021 on 27 October 2021 and draft legislation was published on 4 November 2021 in the Finance Bill. The majority of the Budget announcement were focused on recovering the economy from COVID-19’s impact and preparing the UK marketplace to be competitive in a post Brexit world, with limited changes to the real estate sector.

Continue Reading Autumn Budget 2021: Real estate focused updates

The government has launched the Building Safety Bill, which sets out a new regulatory regime for high-rise residential and other in-scope buildings, based on Dame Judith Hackitt’s review, following the Grenfell tragedy. The Bill, which has had its first reading in the House of Commons, will, as currently drafted:

  • establish the Building Safety Regulator within

Further to our update on the Government’s residential leasehold reforms, the Leasehold Reform (Ground Rent) Bill was introduced into the House of Lords on 12 May 2021. The bill seeks to fulfil one of the proposals set out in the Law Commission’s enfranchisement report and follows on from the Government’s press release made earlier this year, to tackle the inconsistency and ambiguity of ground rents for future residential leaseholders.

Continue Reading Leasehold Reform (Ground Rent) Bill published

Earlier this year, the UK Government reconfirmed its intention to bring forward residential leasehold reforms following the Law Commission’s recommendations last year. The proposed changes are expected to benefit up to 4.5 million leaseholders.

The news will no doubt be welcomed by leasehold homeowners who have been campaigning for changes to what they perceive to be unfair ground rent laws. However, the impact on developers, house builders and landlords, is less clear, but it is likely to affect the legal structuring of both the ownership and the ongoing management of new residential developments.

In this article, we consider what the proposed reforms are, when they are expected to come into effect and some of the potential implications on developer landlords or investors.

Continue Reading Ground Rent Reform – what’s happening and when?