By Jennifer Campbell

Baird Lumsden DM Hall has been a prominent and trusted adviser in Strategic Land sales and purchases since its inception in 1897, but the volume of interest in this complex and very specialist branch of commercial conveyancing is increasing at a prodigious and unusual rate.

There has been a huge uptick in demand – some 20% year on year in the last two years – not only from developers and builders in every corner of Scotland in which our agency operates, but also in approaches from farmers and landowners expressing renewed interest in the disposal of assets.

So, it is of more than academic interest to try to discern what is behind this upswelling of activity, but first of all the question should be addressed: what exactly is Strategic Land and why is it such an esoteric subject?

The simple answer is that Strategic Land is any land or property which has not yet reached its development potential, and for which planning permission, consent or allocation is needed before it becomes a viable proposition.

It is strategic either because of its location – for example, across an access route – or by reason of its relation to existing developed areas, for instance, next to an existing housing development. It should be stressed that developments do not have to be huge – they could be as simple as, for instance, a farm steading conversion.

There could be two realistic views about the increase in interest and activity in exploring the potential of land at the moment, one rather pessimistic and one more optimistic and forward looking.

In the first scenario, there is the move towards a more sustainable and carbon friendly agriculture sector, coupled with the ongoing uncertainty of Brexit and its impact in markets and subsidies. This combination of pressures may be persuading farmers and landowners to offload assets.

Alternatively, it could be viewed as a sign of confidence in the economy as it emerges from the depredations of Covid, allied to the national impetus to increase the housing stock as well as a more benign and flexible planning environment.

Given that the time spans involved in promoting land through the planning system – in some cases up to 10 years – it is within the bounds of possibility that some land holders have been considering disposals, but simply have not spoken to the right people about it.

This is a major issue, given the number of interested parties involved in unlocking the value of a parcel of land. They range from farmers, owners, institutions and charities to businesses, investors, developers, builders or promoters.

Advising them are phalanxes of lawyers, planning consultants, accountants, surveyors, planners, architects, landscape designers and funders. The key figure for reconciling these competing interests and negotiating a deal is often a Strategic Land Surveyor.

Depending on the status of the land – i.e. if it is already within a statutory planning framework – a conditional contract with a fixed price may be suitable. But more common is an Option Agreement where the landowner grants the developer the option to buy the land at market value if and when permissions are granted.

Recently Promotion Agreements have played a part in the market, where the owner and a promoter create a marketing strategy when permission is granted. This course of action fully exposes the asset to the market, but promotional costs can very quickly mount up to the point where they significantly erode the landowner’s profit.

The first step in any potential Strategic Land sale is a visit from a specialist surveyor – a service which, in the case of Baird Lumsden, incurs no initial cost.

And asset holders such as farmers should bear in mind that, even if there is no discernible development value in their land, there is still agricultural value and a pool of willing buyers whose insatiable demand for land means that prices achieved are still on a steep upward trajectory.

Advice from a specialist land agent or surveyor is essential when agreeing Heads of Terms for the promotion or sale of Strategic Land and choosing the correct partner for the planning and contractual framework is absolutely critical. The Baird Lumsden team includes Planning Director Paul Houghton.

For guidance, here are some examples of successful projects in which DM Hall Baird Lumsden has been closely involved over recent months:

· Land at Abernethy – the sale of an agricultural parcel of land which was promoted for development in the Local Development Plan, openly marketed and is now under construction.

· Portavadie Distillery Site – the sale of an allocated site with detailed permissions for a distillery, visitor centre and bonded warehouses. Sold at a competitive closing date https://bairdlumsden.co.uk/property/?propertyid=9872956

· The Clubhouse at Callander Golf Club – marketed as a potential residential or commercial development project, currently under offer https://bairdlumsden.co.uk/property/?propertyid=9946789

· Craigton Farmhouse and Steading – marketed as a residential and commercial development project, sold in excess of the asking price at a competitive closing date https://bairdlumsden.co.uk/property/?propertyid=10478794

To take a recent example, we have been appointed to procure a minimum 20-acre site suitable for self-contained holiday lets, ideally within 45 minutes of Edinburgh. The site must have a degree of shelter (ideally woodland) and would preferably be accessible by public transport.

It should be noted that most Strategic Land sales handled by DM Hall Baird Lumsden are off-market.

Jennifer Campbell is Head of Rural Agency in Baird Lumsden, the specialist rural department of DM Hall Chartered Surveyors.

For further information, contact Baird Lumsden at The Mill, Station Road, Bridge of Allan, Stirling, FK9 4JS. T. 01786 833800 F. 01786 834382 E. Jennifer.Campbell@dmhallco.uk or at 17 Corstorphine Road, Edinburgh, EH12 6DD. T. 0131 477 6001 F. 0131 477 6016 E. info@dmhbl.co.uk

For further information about DM Hall’s nationwide network, please contact:

Caroline Wayte, Marketing Manager

M: 077863 62517

DM Hall, 220 St Vincent Street, Glasgow G2 5SG

E: caroline.wayte@dmhall.co.uk

W: www.dmhall.co.uk.

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