Page 138 - Demo

When planning was simpler (with more outline planning applications) conditional sale agreements were the standard approach for charity disposals, but as planning (and conditional sale agreements) have got more complex they have become less predictable in terms of delivering a successful end result.
While they should deliver higher end prices (than say an unconditional sale), that delivery has become less certain and the wait longer (and the cost of getting the higher sum disproportionately higher).
3. Salewithuplift/clawback
This has become a more common approach in recent years.
The sale is unconditional and for the full value of the land as sold with the then known planning, but through the uplift/clawback the charity seller shares in the upside of any enhancement in value/return enjoyed by the buyer, usually because a planning permission has been obtained by the buyer in a de ned period after they completed on the purchase.
This has advantage to the charity of certainty of money immediately in the hands of the charity and relieving the charity of the care of the property (often empty). It will potentially mean a little less overall return than a conditional sale agreement might generate, as the buyer carries more risk.
The technicalities of uplift/clawback deals (how much the charity gets and triggered by what events) and their documentation (including security to make sure the charity gets paid) are not simple. They can take time to settle and it
is important not to “let the tail wag the dog”; but it is also crucial to get good advice.
We mention both clawback and uplift:
Clawback is usually used when talking about a protection against an immediate resale by the buyer at a higher price: the clawback in effect protects the trustees against what might be seen as embarrassing lost pro t, and usually the seller charity gets 100% of net surplus on sale so as to prevent that.
Uplift is about shares in future added value generated usually by future planning permission and must accordingly be framed as a share of that so as to incentivise the buyer to do it: the selling charity wants that extra income.
134 Chapter 7