It is important to understand the effects of the advice and ensure the agreement reflects the agreed structure and contains provisions consistent with the commercial aims of the parties.
In this paper, we primarily deal with Services DA and Sale.
Typically a forward funding agreement will be set up as two contracts.
Based on the reasoning of the High Court in the Lend Lease matter (discussed below amounts payable under a development agreement to facilitate stage release under a contract of sale may be dutiable as part of the consideration for the land transfer.Woodfield argued: (a) that there was a contractual right to call for Jojill to sell the property and that did not constitute a proprietary or beneficial interest; (b) the agreement only provided Woodfield with a means to recover its management fees; and (c) there was.The agreement required Jojill to sell Lot 2 at Woodfields direction and not otherwise for the sake of realizing the proceeds.The development agreement should also contain an approval process for the design of the development.Lastly there is the forward funding agreement, where the purchaser also provides the finance to cover the development costs as the project moves forward.What is a development agreement?In addition to controlling the costs and revenue, it is important for the parties to agree on the timing of the development and the milestones which should be met in order for the development to be successful.However, any type dream high 2 episode 16 of transfer of the land is important because it will have duty and tax consequences for both parties and may affect the feasibility of the development.Government landowners commonly use a Sale DA with provisions aimed at ensuring the developer constructs exactly what the developer promised in an expression of interest or tender documentation.Many include some or all of the following obligations on the developer: to carry out the particular development in line with agreed plans and specifications; to procure the provision of collateral warranties by the contractor and consultants to the purchaser/tenants and funder; provisions which are.If the parties share control over a development it is worth including appropriate deadlock provisions to ensure the development is not stymied.The Lend Lease decision is particularly relevant for those developers who enter into arrangements under which the purchaser of land has additional obligations to the vendor in terms of infrastructure contributions, sharing of revenue from the sale of the developed land or other similar obligations.The developer will need to ensure: there is sufficient equity in the land to support the construction finance and any leases on the land can be terminated or otherwise brought to an end in a timely manner to allow the development to proceed.
The parties agreed that the development would be staged and that VicUrban would transfer the land to Lend Lease in tranches.
Common milestones include: obtaining satisfactory planning approval obtaining finance approval and commencement of construction.The developers commercial drivers will likely include: minimising the upfront costs and therefore minimising initial funding sharing the development risk with the landowner reducing the chance of assuming environmental liability and other land based liability and minimising duty and other taxes and timing those liabilities.In relation to a Sale DA, the parties should ensure the sale price and any other monies payable under the agreement are structured correctly to avoid unnecessary duty and tax consequences.This paper considers some of the key issues involved in drafting, negotiating and implementing development agreements, and assesses some of the ways to navigate through those issues.The points to consider and safeguard against are different for each type of development agreement.This can occur with or without a profit sharing component.The paper also highlights some tips, tricks and common traps when dealing with development agreements.It is common for government landowners to structure development agreements in the same manner as the Lend Lease development agreement discussed above.Conclusion As eyetracking web usability ebook development agreements are commercially driven, the key to drafting an effective development agreement is to ensure that it reflects the commercial imperatives of the parties, while not inadvertently triggering the application of laws and levies which jeopardise the projects feasibility.A significant lbtt/sdlt office 2010 product key finder windows 8 saving can be achieved by structuring the agreement in this way - as lbtt/sdlt will then only be chargeable on the land price and not also on the construction costs and developer profit.
In a Sale DA the vast majority of the risk is allocated to the developer.
Construction risk primarily relates to the risk of an increase in cost or delays to the project during the construction phase.