Why land promotion?
Under a Promotion Agreement, a Land Promoter such as Axiom assumes responsibility for all the activities and associated costs of bringing a potential development site through the requisite consultation and planning process to procure an appropriate planning consent.
In return for the promotion activities, time spent, associated costs and investment risk incurred to procure planning permission, Axiom receives a success-only fee on the proceeds from the sale of the land, after deduction of agreed third party planning costs.
The use of a Promotion Agreement rather than an Option Agreement has many important benefits to Landowners, including:
The ownership and control of the land remains firmly with the Landowner until the Axiom has been successful in achieving an Allocation and or Planning Consent and the sale of the land to a delivery partner/housebuilder at a price agreed between the Landowner and Axiom
The Landowner’s Solicitor’s legal fees and Land Agent fees are paid by Axiom
Axiom will present and agree a marketing and sales strategy with the Landowner’s Agent once Planning Permission has been achieved
A competitive and transparent marketing process for the land, with the benefit of Planning Permission, will be managed by Axiom to ensure maximum open market value for the land is achieved for the Landowner
The sale transaction of the land will be overseen and coordinated by the Landowners’ Agent and conducted the Landowner’s Solicitor
Axiom only receives the reimbursement of agreed third party promotion and planning costs (capped) and the agreed success-only Promotion Fee when the land is sold. Hence Axiom is so highly motivated to secure Planning Permission in the shortest possible timeframe
A Promotion Agreement contains a number of promotion obligations relating to timing, minimum land values, minimum developable areas, cap on promotion costs and s106 contributions to ensure the Landowner’s and Axiom’s interests to maximise the value of the land are and remain fully aligned
The Landowner retains control of the ownership of the land and the timing of the process as Axiom has no ability to ‘land bank’
The many and substantial benefits of Promotion Agreements over Option Agreements for Landowners has resulted in an increasing majority of residential and commercial development sites being brought forward in this way through genuine Promotion Partnership.
The ‘win-win’ nature of a Promotion Agreement is firmly aligned with the clear sense of fairness which is at the core of Axiom Developments’ culture; it drives everything we do.
Entering into a Promotion Agreement with Axiom Developments is a relatively simple process that can be initiated very quickly and is usually completed within a few months. See “The Promotion Process”.
