With any contract, it’s pivotal that both parties understand it before agreeing to the commitment of the contract. In terms of an option agreement, it’s the contract formed between a developer (purchaser) and a landowner. It’s our job to ensure that whether you’re the developer or landowner that your option represents your exact requirements.
An option agreement is an agreement between two parties – the landowner and a potential buyer (the developer). It allows developers the ability to purchase a specific area of land after they’re granted permission for the development. It provides the right, but not the obligation, for a party to purchase, sell or gain an asset at a certain price and at a particular period of time.
Both parties enter into an agreement in return for a non-refundable sum of money. This is then paid to the landowner and in exchange, the buyer is granted first option to buy the asset. This is agreed contractually through an option agreement.
A potential buyer of the asset in question (property or land) has a legally binding option to buy on a specific day, within an agreed time-frame or after the completion of an event.
They contractually can only complete the purchase within the option period. The period could be as long as several years, or can be triggered as a result of an event; such as the planning permission being granted for the development.
Every option agreement will differ depending on the facts and the reason for the agreement. They do each however have similar requirements within an agreement.
Our specialist team of lawyers are skilled in the preparation of commercial contracts and agreements. They’re experienced in acting for either a developer or the asset owner in an option agreement.
Before committing to any kind of option agreement, we recommend you seek legal advice.
By working with our solicitors, we will be able to review the agreement and ensure your best interests are being met.
Please do not hesitate to get in touch whether you have a question or you would like to arrange a call.
Middletons Solicitors have a reputation for excellence with offices based in Warminster, Andover and Stockbridge. With more than 50 years’ experience delivering comprehensive legal services, our team of legal experts provides the highest standard of advice and service.
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