Have you ever wondered what overage or clawback was?
Have you got surplus land suitable for development, but can’t see yourself as a developer?
How could you benefit from future developments on that land?
The answer is through an overage or clawback payment.
When you sell land, you can agree with your buyer that additional payments will be due to you, if and when the buyer obtains planning permission to develop the property, or when such a planning permission is carried out. The payment is in addition to the agreed purchase price and is usually expressed as a percentage of the increase in value of the land.
You will need to consider the following:
Therefore the imposition of an overage or clawback provision needs careful consideration and drafting.
You will need an experienced commercial solicitor to draw up a suitable document to make sure that your interests are protected and that the obligations are enforceable.
If you have any questions regarding Overage an Clawback, please do get in touch either by email or telephone 01579 347600.