Charity Property

Charities and not for profit organisations often deal with land, whether for their own use or as an investment.

Charities holding property and land must deal with a greater regulatory burden than ordinary businesses and landholders and must comply with additional statutory requirements as well with as their own governance and trusts.

Our partner-led team of property solicitors are experienced in providing the specialist legal charity property advice needed to navigate these challenges as well as providing robust, commercial and pragmatic advice, drawing on our knowledge and experience in the commercial sector.

Our team of solicitors pride themselves in being an integral part of our charity clients property teams and are all experienced in charity property law. We are able to advise on the following:-

• Property transactions (conveyancing, buying, selling, and leasing)
• Landlord and tenant matters
• Property and land management
• Property disputes
• Development of assets and planning matters
• Structuring property acquisitions with grant funding or loans
• Regulatory Compliance – including Charities Act and Charity Commission
• Establishing endowments of land and buildings
• Mergers and closures of charities
• Conversion of unincorporated charities to Charitable Incorporated Organisations (CIOs) or Charitable Companies
• Registration of changes of trustees at the Land Registry
• Registration of Charity Property with the Official Custodian for Charities
• First Registration of unregistered land

Contact

[rotator]

If you require any charity property advice, please contact Archie Sherbrooke (Archie.Sherbrooke@lbmw.com) or Nishita Gudka (Nishita.Gudka@lbmw.com) or Lina Rodriguez (Lina.Rodriguez@lbmw.com) or complete the online enquiry form

Alternatively, please dial 0207 222 5381 and ask to be put through to either Archie, Nishita or Lina.

Our Charity Property Services

We are  trusted advisers to  a diverse range of charities and not-for-profit organisations, foundations and trusts from small social enterprises, family charitable trusts and foundations as well as  religious and educational, Royal Charter charities and Livery Companies through to national charities with significant land wealth and large grant making organisations. We understand that each organisation has its own specific needs and  work closely with our Charity team to ensure that our clients understand and work within the confines of their trusts/governing document, suggesting amendments or changes where appropriate. We understand the requirements of the Charities Act and the need to comply with the Charity Commission Guidance, obtaining their consent as needed.

We also work side by side with our Private Client team in relation to philanthropy and philanthropic giving, assisting clients with their lifetime estate planning

Charity Property Transactions, including disposals and acquisitions

All of our charity property team are experienced in dealing with commercial and residential sales and acquisitions and are qualified with the Law Society’s Conveyancing Quality Scheme. We understand how vital property investment for charities can be and the complex regulatory framework of charity property law which must be complied with when buying property for a charity or selling property for a charity. Our solicitors are able to advise on all aspects of a sale or purchase of charity property including dealing with pre-contract enquiries, drafting and negotiating contracts, including conditional contracts as well as overage and clawback agreements, drafting and negotiating the transfer and dealing with registration at the Land Registry.

We are familiar with the operation of the Official Custodian for Charites and the role it plays as custodian charity. We can register property with the Official Custodian for Charities land holding service and are very familiar with procedure for disposing of land held by them.

We have excellent links with RICS qualified surveyors, and other professionals who are able to act as Designated Advisers. We advise on connected party disposals as well as the sale of endowment, specie land and designated land and are able to contact the Charity Commission on your behalf to obtain any necessary consents.

Landlord and Tenant

Our solicitors act for both charity landlords and tenants in relation to the preparation and negotiation of leases and other tenancy agreements. We also act in relation to the giving or request for consent to assign, licence for alterations, rent reviews. We regularly act on landlord and tenant disputes including matters of forfeiture, breach of lease terms and dilapidation claims.

Our experience in dealing with commercial landlords and tenants means that we are up to date with the ever changing legislation and case law in this area including matters of security of tenure.

LBMW advise on matters of regulatory compliance for both landlords and tenants, including complying with the Charities Act and Charity Commission Guidance.

Property Disputes

Our property litigation team have acted for a number of charities in relation to disputes involving land, including proceedings in the county court, High Court and Court of Appeal and understand the complexities in representing charities. We are experienced in advising charities and charity trustees on the matters they need to consider both before and during proceedings and how best to protect the position of trustees.  This extends to both charity proceedings and standard proceedings in which charities may be involved.  

Contact Stephen Dean (Stephen.Dean@lbmw.com) or Clifford Woodroffe (Clifford.Woodroffe@lbmw.com) - Commercial Litigation & Dispute Resolution Solicitors in Westminster - Lee Bolton Monier Williams

Charity Property Management, Development and Governance

LBMW advise charities with real estate investments on the management of their land, working closely with their in-house teams and other external professionals such as surveyors  to establish appropriate reporting structures and compliance frameworks relevant to the charity’s real estate needs. We provide strategic advice to charities in relation to the management and development of charity property assets considering the long and short term aims of the charity.

LBMW advise on the regulatory and governance requirements in maintaining and managing their real estate investments and are able to prepare the relevant policies for charities. We can assist with maintaining a data room to manage charity real estate assets.

Endowments and Designated Land

LBMW advise charities in establishing new endowments or designating property for a particular use. We understand the importance this plays in protecting certain assets for the furtherance of a charity’s charitable purposes.

We are also able to assist with the disposal of endowments or designated land, including reviewing of a charities records to establish the restrictions placed on the land, compliance with the relevant statutory requirements as well as applying to the Charity Commission for consent to make a disposal.

Closures of Charities, Conversions to CIOs and Company structure and Merger

Our charity property lawyers are experienced in dealing with charity real estate on the closure, merger or  conversion of charities. We work closely with our charity team to ensure that property assets are transferred at the appropriate time to avoid operational disruption and to ensure compliance with all statutory and regulatory requirements

LBMW understand the legal complexities involved in dealing with leases on the conversion of a charity including obtaining landlord’s consent, dealing with subsisting liabilities such as dilapidations and rent reviews and dealing with any occupational tenant.

Secured lending and grant funding

LBMW regularly act for charities in relation to the giving or taking of security for loans and grant funding. We act both for the funders and borrowers in relation to secured lending and advise charities on the specific needs relating to the Charities Act.  

Frequently Asked Questions about Charity Property Law

• What is charity property law, and why is it important?

Charity Property law governs how a charity and its trustees deal with any real estate assets i.e. any land and buildings.

Charity Property law includes matters relating only to charities, including how they are governed, their regulation by the Charity Commission and specific charity property or charity real estate requirements. In addition, all charities must also comply with matters of land and property law including land registration, landlord and tenant matters and property disputes.

Failure to comply with Charity Property law can lead to transactions being deemed void and can render trustees personally liable for any losses incurred by the charity.

• What are the legal requirements for charities buying or selling property?

When purchasing or selling property or land, charities and charity trustees must consider whether they have the requisite power to do so, both in their governing documents and under legislation.

Non-exempt charities selling land must also ensure compliance with the Charities Act.

Charity trustees must always take decisions that are in the best interest of the charity.

• How do trustees ensure compliance with the Charities Act during property transactions?

Charities must comply with the strict legal requirements set out in the Charities Act 2011 when selling property. The requirements apply to non-exempt charities and are in place to ensure that charities and charity trustees are always acting in the best interest of the charity. The requirements will vary from transaction to transaction and can include obtaining a designated adviser’s report and/or other professional advice, giving public notice of a transaction and if necessary obtaining the Charity Commission’s consent to a transaction.

• What is the role of the Charity Commission in property matters?

The Charity Commission is the regulator of all charities in England and Wales. The consent of the Charity Commission may be required for certain transactions including any disposal to a connected party or for the sale of designated land.

• What is the Official Custodian for Charities?

​The Official Custodian for Charites is a corporation which has been set up to hold land for charities. Land can be vested in the Official Custodian for Charites and registered at the Land Registry in the name of the Official Custodian for Charities.  This may be useful, particularly for unincorporated charities as it reduces the administrative burden on charities to notify the Land Registry on each change of trustees.

• What should we consider before leasing property as a charity?

All charities should take advice from specialist property lawyers prior to taking a lease. Charities should also consider engaging with a specialist surveyor who will be able to negotiate the key terms of the lease, such as rent, rent reviews and service charges, on behalf of the charity.

Charity trustees should consider other costs associated with the property, such as business rates, unities and the cost of any repairs.

Charity trustees should ensure that they understand all of their obligations under the lease, how the lease can be terminated prior to the contract term date and what will happen at the end of the lease.

• Can charities use their property as collateral for loans?

Yes, but charities can only do so if they have power  to do so in their governing documents and then must comply with the requirements of the Charities Act.

• What are the tax implications of charity property transactions?

Tax for charities can be complicated. There are a number of reliefs available to charities on the sale and purchase of property but these will be transaction specific. Specialist charity tax advice should always be sought and we would be please to discuss your needs further. 

• How can we resolve disputes involving charity-owned property?

Disputes involving land and property are common and our specialist litigation team can provide further advice. Charities and their trustees must always consider whether any taking action or incurring costs in defending any claim is in the best interest of the charity.