The long term nature and high level of recession-proof security afforded by ground rents makes them an attractive investment for investors looking at a long term, low risk investment.
We act for residential developers looking to dispose of their freehold reversionary interest development sites either before, or following, completion of the sales of the residential units. We also act for ground rent investors looking to purchase these investments.
We can assist in relation to all aspects of ground rents, including:
- Dealing with the sale or purchase of portfolios of ground rents.
- Advising on whether the proposed transaction will trigger the residential tenants’ rights of first refusal to acquire the interest being sold on the same terms as the proposed disposal, pursuant to the Landlord and Tenant Act 1987 (the “Act”), whether prior to commencement of development, or during the course of development.
- Guiding you through the pitfalls of the Act, which imposes criminal liability.
- Identifying legitimate ways of structuring each transaction so as to take the benefit of one of the limited exceptions from the tenants’ rights of first refusal.
- Advising on the potential tenants’ rights against subsequent buyers of the freehold reversion if the procedures under the original disposal were not strictly adhered to.
- Drafting and serving the necessary statutory notices on behalf of the developer and advising tenants who receive such notices or their rights under the Act.
- Advising freeholders/developers on, and drafting, deeds of variation to residential leases which contain doubling/tripling of ground rents and/or compounding rent review mechanisms to vary them to less onerous rent review mechanisms, yet still retaining their investment value for ground rent investors, in the light of recent negative press regarding such ground rents and possible future legislation in this area.
- Acting for a ground rent investor in connection with the management of its ground rent portfolio, including advising on the enforcement of the collection of ground rents and breaches of tenants’ covenants. Dealing with tenants who are in breach of their lease terms, including non-payment of ground rent and breach of tenants’ covenants.
- Dealing with consents for assignment, underletting or alterations and providing certificates for Land Registry purposes.
- Dealing with lease extensions.