The impact of project development agreements on commercial enterprise can be substantial.
‘Project development agreement' is an umbrella term for an agreement comprising of various elements within a wide-ranging plan . Typically, these will be between landowners, developers, tenants, purchasers and funders. Commercial agreement solicitors are able to advise on the legal ramifications of the entire development process, from inception to completion.
Commercial agreement lawyers
Oratto can provide easy access to an experienced commercial agreement solicitor. Having solid legal advice in place before you proceed with a development is essential to ensure the smooth running of the project.
Our online method of connecting highly experienced solicitors with clients who require legal services in many different areas enables you to take control of selecting your own commercial solicitor. Alternatively, you can send your individual details through to Oratto and we'll match you with the right lawyer for you using our Oratto Match function.
Different types of project development agreements
- Agreement for lease, or a pre-let agreement - A tenant has contracted to take a lease of the property when the development has been completed
- Stand alone development agreement - When a landowner contracts with a developer to carry out construction of the development either at the landowner's expense, or the developer's expense, then this is known as a ‘stand-alone' development agreement
- Forward purchase agreement - This applies when a developer contracts to sell to a purchaser and the parties enter into the contract at a very early stage. The terms of the agreement mean that the investor only pays once the development has been completed. Before this, the developer is responsible for construction costs. The contract will state when the title transfer takes place (typically on project completion) and it will set out the price to be paid. This could be a fluid figure based on the amount of rent predicted to be paid by tenants once the development is finished, or it could simply be a fixed sum
- Forward funding agreement - Where the purchaser is providing funds for the development project as it is ongoing
Clearly each agreement will be tailored to the individual project, but there is likely to be a mass of sections and detailed clauses generally found in all development agreements. Your chosen solicitor will be able to explain the specifics to you, relevant to your project, but such clauses are likely to include:
- Statement of stipulated standards; used to ensure that the development is of high quality
- An obligation to carry out the development in accordance with the agreed specifications and to plan
- A general timetable of development progress; plus a final date for completion known as a ‘longstop date'
- Rules and regulations regarding prospective leases for the development. There may also be a sample form of lease agreement attached
- Provisions for ensuring collateral warranties by the development consultants and contractor to the funder and tenants or purchaser
- Provision for monitoring and inspection rights for the tenant or purchaser. In addition, there will be provision for the right to terminate the agreement in the event of the developer becoming insolvent, if they are in serious breach or if they fail to complete by the longstop date
Project development agreements can potentially be a complex area, but with advice from Oratto member commercial agreement solicitors the complexity can be simplified. Contact Oratto today for bespoke advice regarding your project development agreement.