Leaseholds: Sample Scope of Work

  • Consider the range of lease terms and their appropriateness to purpose (e.g. a resort development or material infrastructure may have a return on investment that is based on a significantly shorter period).  A flexible approach to lease terms should be engaged, ensuring that whatever term is adopted is in the best interests of the custom landowners, whilst ensuring that the term is appropriate for an investor to recoup a return on their investment.
  • Advise on the frequency and quantum of rent review options .
  • The responsibility on tenants to return the improvements in good and tenantable repair on lease expiration is not clearly articulated in the wording of many leasehold titles.  A clear policy that remedies this deficiency is required together with recommended drafting protocols and wording for all new leases recognising that the improvements must belong to the landowners and form part of the reversionary interest.
  • Critically assess and suggest alternatives,  (if any) to the template terms and conditions of leases and licensing agreements currently in use such that it is consistent and  compatible to the generic and specific clauses  that underpins international best practice and that is unique to the context of land use and industry concerned.
  • A Review should recognise the transdisciplinary nature of the management of customary land.  Evaluate the current and future capacity requirements and training needs to ensure suitably qualified staff can be trained and recruited to deal with building, valuation, development feasibility, resource/agricultural/ecological economics, legal, management, planning, GIS, negotiation and client relation matters.
  • Where land is held under a lease and is already improved there is a market (or potential development) basis on which to determine the value of the land.  Rather than rely on the outdated and hypothetical construct of unimproved capital value as a basis for rental agreements, the Review can recommend a more equitable market based arrangement that will secure the optimal return to the customary landowners, whilst ensuring that a lease on Customary or Native Land remains attractive to current and prospective tenants.
  • Identify in detail the valuation and forecasting approaches used by developers and prospective tenants on Customary / Native Land.  Evaluate how valuation practice on Customary Land can meet contemporary International Valuation Standards (IVSC).
  • Develop and deliver a training module to improve the capacity of staff / advisers involved in the valuation of lease interests and also in understanding the valuation and forecasting approaches used by developers and prospective tenants on Customary / Native Land, and ensure compliance with International Valuation Standards.
  • Research, identify and develop transdisciplinary continuing professional development modules to assist staff and local professionals development in engaging international best practice in relation to the marriage value (or synergistic value) associated with development on customary land and related aspects (including, but not limited to, prospecting agreements, exploration licenses, mineral extraction, cultural heritage issues, environmental impact issues, carbon sequestration, climate change, use of adjacent customary fishing areas).
  • Prepare continuing professional development resources dealing with compensation issues where there is a taking, damage, or associated loss of Special Indigenous Value.
  • Evaluate the current scope and coverage of relevant legislation in relation to its consideration of incidents of customary / native lands and how it has successfully incorporated measures to address incidents of cultural heritage, carbon sequestration, environmental management, prospecting and mining etc.

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