Real Estate Developers make up a large part of our property practice clients. As a result we assist with every aspect of property development ranging from structuring the purchase of the property, negotiating the contract to structuring the financing of the purchase. We also deal with planning issues, negotiating building contracts, liaising with surveyors, advising on subdivision issues and body corporate rules, preparing simple English sale contracts and assisting in marketing the property.
Our experience in selling and buying off the plan developments and our extensive marketing experience in Asia should make our office the first stop for developers considering marketing their properties overseas.
Please contact us to get professional advice if you have any questions regarding property development.
At P&B Law we can guide you through the process and assist you with all aspects of property development including:
- Design and Consultants
- Building Contract
- Negotiating the commercial terms of the contract;
- Examining the various financing options including using options, time, and security instruments to be in a position to settle at a suitable time for you;
- Undertaking proper due diligence including speaking to local Council planning officers, neighbours and tenants, to ensure you are aware of any specific proposals for the land or any adjoining land;
- Establishing a proper market value for the property to ensure you are not overpaying;
- Reviewing the contract document and disclosure statement;
- Affecting exchange to ensure that a binding contract is set in place.
- The choice of structure is essential for asset protection. It is also important to consider your tax position and how it will be impacted by the various structures you may choose.
- If you are proposing to develop land with someone else it is essential that all issues are set out in a proper partnership or joint venture agreement. This agreement will cover such issues as individual partner’s roles, funding, decision making, first options to purchase and dispute resolution mechanisms
Financing considerations include:
- Market value at the date of acquisition
- Market value upon grant of Town Planning Permit
- Market Value upon completion of construction
- Cash flow through the life of the project
- Types and extent of securities required by financier including cross collateralisation
- Mortgage and security documents
Design and Consultants
- Town planning issues revolve around zoning, requirements of planning schemes, density, design and impact on neighbours. Occasionally external reports such as traffic reports and environmental impact statements will be required.
- You should retain consultants on a contract and upon terms that you choose, rather than through the use of their standard terms and conditions.
- Most developers undertake pre-sales of their properties through “off the plan” contracts. These contracts include plans and specifications, a plan of subdivision, relevant permits and searches, Owner’s Corporation/ Body Corporate rules, expected date of delivery of the project and a variety of special clauses that deal with the need for the developer to complete the project.
- Consideration ought to be given to residential projects which will require special conditions to be inserted to deal with domestic building legislation;
- Stamp duty benefits which may apply to properties sold off the plan.
A building contract is an essential document that can often spell success or disaster for the development. Critical issues in a building contract include:
- Plans and specifications
- Time for construction
- Extensions of time
- Liquidated damages
- Unexpected events
Each of these issues must be considered carefully and a formal contract must be created to ensure that the developer’s rights are properly enshrined in an enforceable manner.
A plan of subdivision divides a larger title into smaller titles.
- Titles can relate solely to land but can also involve air rights.
- Plans of subdivision can also contain easements and various covenants about the use to which the land can be put and any other rights that the developer may want to reserve for himself or others.
- Owners Corporations/Body Corporate Rules ensure the proper conduct of the various occupiers within the development.
The usual off the plan contract must make provision for the settlement to occur upon the happening of two events:
- The grant of the certificate of occupancy;
- The registration of the plan of subdivision.
In order to prepare for settlement, a number of events must occur including:
- Notifying the purchasers
- Booking settlement
- Reviewing the statement of adjustments
- Executing transfers and statutory declarations
- Attending settlement
- Filing notices with Government departments
- Liaising with financiers
NOTE: This list is not exhaustive and you must consult a properly qualified legal professional prior to the commencement of your development project. A developer’s pre-settlement checklist is made available to our clients to ensure that all details are taken care of. Contact us to assist you with any queries you may have regarding property development.