Maximising land values at compulsory purchase

compulsory purchase land value

Landowners facing compulsory purchase can get fairer compensation by obtaining a certificate of appropriate alternative development (CAAD). Paul Walton explains what CAAD is and how it could help.

We recently gained a certificate of appropriate alternative development (CAAD) for a couple whose land was being compulsorily purchased for the Broughton bypass, a £25m relief road being constructed in Lancashire.

As we understand it, this was one of the first such cases to go through the planning system in this region since the early 1980s, so CAAD isn’t all that common.

However, it can have wide ranging implications for all landowners who may be subject to compulsory purchase now and in the future, particularly as planning law has changed so much in recent years.

Planning a route to fair compensation

The client we represented believed the land being compulsorily purchased had potential for residential housing development.

So we asked the planning authority for a certificate confirming that planning permission for housing would have been granted and this was taken into account by a surveyor who valued the land to ensure appropriate compensation was paid.

By showing what the land would have been worth if it had been sold for the purpose of building homes, our clients were able to obtain a far greater level of compensation than they would otherwise have received.

How CAADs help landowners subject to compulsory purchase

While not an outright planning application, the purpose of applying for a CAAD is to provide valuers with guidance on the fair market value of land being acquired by a local authority with compulsory purchase powers – in this case Lancashire County Council.

Changes in the Localism Act 2011 to the compulsory purchase of land mean planning permission should be presumed for ‘appropriate alternative development’. This is defined as development on the relevant land where no planning permission is in force, but which could reasonably be expected to have been granted if applied for.

Armed with a CAAD, landowners facing compulsory purchase can establish that there is no reason why planning permission for residential development would not have been granted, had they made an application. As a result, the amount of compensation paid increases substantially.

However, the planning law involved in the application process is highly technical and specialist professional advice should be taken at the outset.

For further advice on planning issues surrounding compulsory purchase and appropriate alternative development, e-mail Paul or call him on 01772 369669.