WHAT IS LAND ASSEMBLY?
Land assembly is the selling of multiple properties in a single transaction to create an otherwise unachievable, higher valuation for each individual property owner; all factors are considered. They require longer timeframes to complete – this is often divided between aligning the ownership and their expectations and sourcing appropriate buyers for their project. Then the process of creating bid pressure to source the best price and terms for the sellers takes place.
WHEN MIGHT YOU CONSIDER LAND ASSEMBLY AS AN OPTION FOR A GROUP OF OWNERS?
There are typically three circumstances that lead to a land assembly:
- A recent change in the official community plan (OCP), neighbourhood community plan (NCP) or zoning that may increase the density or use of the particular parcels.
- As buildings near the end of their life, typically a strata or co-operative, the cash required by each owner to maintain in special investments or future capital investments are becoming costly compared to the value of the property.
- A common need by all area land owners that can only be achieved through a much larger, collective approach. For example, servicing land (sewer, water, gas, electricity, and other services), where the cost for any individual parcel would be prohibitive and far too costly (i.e.,. the creation of a master community plan).