In the current economic climate, margins have reduced considerably for all businesses - those developing property, whether for residential or commercial use, are no exception. This update lists a few salient reminders for those considering a site for development in Jersey.
Jersey is rightly renowned for its beautiful natural environment, but this in turn means that anyone seeking permission to build can face particular hurdles, depending on the nature and location of the land in question.
Jersey's latest island plan came into force in June 2011, requiring planning applications that might affect important or protected biodiversity sites to be accompanied by an appropriate level of ecological information.
To protect a current total of 51 specified unique or endangered plants and animals under the Planning and Building (Jersey) Law 2002, natural sites of special interest (SSIs) are listed on a special register to ensure that applications for development are sympathetic to the particular species identified - often, special measures will be required.
Jersey currently has 13 ecological sites and 21 geological sites listed, but the Environment Department is continuing to consider and add sites on a regular basis.(1) All developers must be alert to the fauna and flora of the site under consideration, even if the site is not listed.
The Planning and Building (Environmental Impact) (Jersey) Order 2006 requires the planning authorities to order an environmental impact assessment (EIA) in certain instances - for example, for most developments exceeding 0.5 hectares.(2) However, other applications can result in an EIA being sought. The developments at the former Jersey Dairy site and at Castle Quays both required EIAs. The EIA process aims to promote sustainability by enabling environmental factors to be given weight alongside the economic and social consequences of a potential development. Developers must be particularly wary of the entirety of the site - for example, will stabilisation works be required or even retrenchment of adjoining land? If so, an EIA could be ordered that includes the whole area on which even initial demolition or stabilisation works are to be undertaken. While the main site may have no significant fauna or flora, many former quarry sites are now homes to green or wall lizards, or a colony of the Jersey vole may have established itself in adjoining woods or farmland whose presence may result in delays during the planning process and costly alleviation measures.
Some species of fauna and flora are significant for altogether less salubrious reasons. For example, the infamous Japanese knotweed (Fallopia japonica) is infamous for causing delays and expense to developers where identified on a site. The development of a site in the absence of appropriate Japanese knotweed controls can result in the spread of the plant (both within and off-site), and can result in subsequent damage to property once the plant re-grows. The use of specialist contractors which can provide warranty-backed Japanese knotweed eradication programmes in advance of development is always recommended.
Bats too, if found on a site, are bad news for developers. Because of the decline in numbers of bats, they are now fully protected by law and it is illegal to kill or injure a bat or disturb them or their roosts. This includes blocking up entrance holes. The States of Jersey has published a leaflet summarising signs to look for.(3) If evidence of bats is identified, then a full bat survey is often needed. Because of their winter hibernation patterns, this must take place before mid-autumn in any year; otherwise it may be necessary to wait until the following Easter before any works can take place - an expensive period of inactivity for any developer.
At a more extreme level, a site could have the potential to be contaminated land, resulting in the attendant obligations and costs of potential remedial action. While Jersey has a limited history of heavy industrial uses that leave a legacy on sites, certain current and historic land uses can pose a risk - for example, chemical works, ceramics and glass works, petrol stations or burial grounds. Planning conditions are often used to require investigation and, where appropriate, remediation, to bring the land to an acceptable condition as part of the development process.
As well as the fauna and flora of the site, the structures on the land require particular consideration.
In January 2011 the way in which historic places and buildings in Jersey are protected changed. Heritage assets formerly designated as sites of special interest are now known as listed buildings or places - this is to protect the archaeological historic or traditional importance of such buildings to the island. Additionally, some sites are designated areas of archaeological potential. Prudent searches of the relevant registers will reveal any current listing, but non-listed sites can also have structures that lead to delay and additional costs.
Several of Jersey's now derelict sites have traditional granite structures on them (eg, old pig houses), which may need to be relocated or even retained as part of the planning consent process.
While many developers have favoured 'tried and tested' precedent contracts, it is always worthwhile ensuring these are reviewed periodically and that they reflect any relevant case law.
Although it was decided in the English courts, the recent case of Nirah Holdings v Hanson provides a salutary warning for developers to ensure that their option agreement contains an obligation on an owner to sign any planning agreement. In Nirah, a 180-acre clay pit site was to be redeveloped into a £375 million mixed-use site with aquarium, hotel and exhibition facilities, as well as housing. After applying for planning permission, as required by its contract with the landowner, Nirah successfully secured planning, subject only to a planning obligation agreement to which Hanson (the then-owner of the site) was required to be a party. However, when Nirah approached Hanson, it refused to sign, citing its own concerns regarding the terms of the agreement - largely founded on the potential adverse impact on its adjoining land - which it wanted to develop.
The English courts ultimately found that Hanson's reasons for refusing to sign the planning agreement were inappropriate in the circumstances, but the case provides a warning to ensure contracts are drafted so as to ensure that an owner cannot frustrate a conditional contract for its own gain.
Although the controversial land development tax was narrowly out-voted in the States Assembly on November 3 2011, there is ongoing consultation regarding the issue of social housing and developers can expect further legislation proposals on the subject during 2012. The potential impact on profits for a developer means that a watchful eye must be kept on any such proposals.