for the umpteenth time

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    for the umpteenth time

    sorry to wheel this topic out again but not sure i've seen it phrased this way. i'll keep it short!

    if the leasehold owner of top floor flat buys (roof space + roof + airspace above roof) from freeholder with future ambitions to develop roof void beyond existing envelope and has his lease amended to include these, does this by itself guarantee him permission in future to proceed with said ambition, for no further premium, and assuming he later obtains the relevant consents from local authority and license to alter application? is it a matter for the solicitor to ensure the new lease is watertight i.e. reflects the understanding reached with the freeholder? i struggle with the correct order of doing things given each step has a cost and each step is not guaranteed to succeed.

    #2
    For the umpteenth time it depends on what the (amended) lease says.
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

    Comment


      #3
      If buying a roof space to develop it you make absolutely sure that you have permission to do with it what you want to do with it. Also a good idea to get all necessary permissions from the planning authority before shelling out on buying the roof space.

      You do of course get a lawyer to look at the lease and advise whether you have the roof space anyway since a failure to specifically include it does not mean it is excluded. In case you lawyer overlooks it, you ask him to consider carefully the effect of section 62(2) of the Law of Property Act 1925.

      Comment


        #4
        Couple of things regarding planning permission - agree it would be better to have that first but will take time and i have a window of opportunity right now - long story. Since you mentioned it...does the absence of any planning permission impact surveyor valuation of roof void and air space above it? I would have thought so.

        That's interesting what you say about the roof not necessarily being excluded - i will seek advice. But would you agree that when the roof space has zero potential as habitable space unless developed beyond its current envelope and into airspace, ownership of the roof space alone is hardly an advantage in these matters?

        Comment


          #5
          does the absence of any planning permission impact surveyor valuation of roof void and air space above it? I would have thought so.
          Possibly. A question of valuation I am not competent to answer. However, in practice the price is going to be assessed on the basis that you want to do a conversion rather than use the loft for storage. You cannot hide your intentions as you are almost certainly going to need permission to make alterations. More importantly, you do not want to buy only to find that all you can do is use the loft for storage because you cannot get planning permission.

          But would you agree that when the roof space has zero potential as habitable space unless developed beyond its current envelope and into airspace, ownership of the roof space alone is hardly an advantage in these matters?
          You are probably right. The thing is though that if you need more than you have got then, however much you have, the person who has what you need can set his price. It is then up to you whether you buy. Even so, if you do own the roof space you at least have a bargaining chip even if the freeholder holds all the best cards.

          Comment


            #6
            Perhaps the lack of planning permission impacts on the share of development value accruing to the landlord (e.g. 10% instead of commonly accepted 25%) as opposed to the total development value itself which as you say is based on my intention which by the way is well advertised. At the right price i might be prepared to take the risk.

            That sounds very fair. I am curious now...would you mind checking my lease...will probably take you 2 minutes to conclude if it's included or warrants getting paid advice to check it is not excluded?

            Comment


              #7
              The question of valuation depends on two main things. If we assume that you have to acquire the premises then the landlord is under no obligation to sell, and can rightly insist on any price( not a premium) for the premises (air space roof structure and internal space).

              If the existing lease or arrangement can be said to include the air space it may be unlikely to include the roof which needs to be acquired and altered whether with dormers or a new raised structure. In this case the landlord is under obligation to do so and can charge a premium for the roof and a change of use from say storage to living space.

              There is no generally accepted figure, and planning permission does not really apply as it is unlikely that you would proceed without the prospect of getting permission and therefore the landlord who is under no obligation can ask what he likes. it is only the prospect of cash that entices him to negotiate a figure, price or premium, that makes the project realizable.
              Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

              Comment


                #8
                I understand the landlord is generally under no obligation to do anything but let me put this to you - the shareholders have expressed overwhelming support for me to develop the loft at the AGM. I doubt they understood what this entailed at the time i.e. disposal of both roof and airspace for a price but fact remains support to develop the loft was given explicitly and minuted. The board communicates asset disposal policy to shareholders and introduces idea that there is a price to be extracted and commissions an independent RICS valuation at my expense. The question is what are the board reasonably obliged to do in these circumstances - is it not to set a fair price for the transaction (aside from consulting with surveyor, engineer, solicitor etc)?

                What should be the terms of engagement with the valuation surveyor in these circumstances? I have seen the valuation report and it's opening sentence is to emphasise that 'market value' is 'best' value not 'fair' or 'average' value. Not sure i understand the point of this qualification.

                If it is only cash that entices the landlord, then should i decide to purchase the roof space now but delay the purchase of airspace until and if planning permission is given then is it not rational to offer a concession to transact both now?

                Comment


                  #9
                  "A fair price" is entirely subjective. For instance, would the price be based on what the space is worth as is, or based on the uplift you are going to receive in the value of your property?

                  The Directors owe a fiduciary duty to the freehold company.

                  I'm not sure I understand your differentiation of roof space and air space? In any event, planning permission should be considered prior to purchasing.

                  Comment


                    #10
                    The answer s that the board or company is under no obligation to sell and can take the approach that they wish there is no concept of fairness. The company has to look to the board or itself if it however takes a view that leads to an asset not being realized so the aim that they have is an achievable price if the board or company is minded to sell.

                    The valaution will be based on the uplift in the open market value to your property, in this case, as explained.
                    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

                    Comment


                      #11
                      Lha's point that the directors ought not to lose an opportunity to sell is a good one where a leaseholder who wants to buy is the only person in the market. Where all the shareholders agree to sell at a price below that recommended by a valuer there is no reason for the directors not to proceed. Where a majority agrees the position has to depend on what the company's constitution says and the rules designed to protect minority shareholders.

                      Roof space = the space between the roof and the ceiling of the floor below.

                      Air space = the space above the roof.

                      Comment

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