BASIC DARK PRESENTATION

Prepared by Navleen Gulati30 August 2023

Optimising Sustainable Development Transactions: A Strategic Approach

Insights into legal relationships and strategic transaction structuring

Go!

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Finalise s106 agreement between landowner, LPA and EB

STEP 3

Enter into immediate 30+ year sublease and habitat management agreement

STEP 2

Enter into 30+ year headlease from landowner to EB

STEP 1

Transaction Structure:

1. Legal relationships with landowners governed through leases and habitat management agreements.
2. Legal relationships with LA and responsible bodies governed through s106 agreements or conservation covenants.

Key Legal Relationships and Transaction Stucture

Overview of Legal Relationships:

‘What if we shifted the narrative from 'Nature needs our help' to 'We need nature's help'?’

- Sarah FowlerChief ExecutiveWildlife and Wetlands Trust

Question 1

Do you think this approach of completing leases first and the s106 agreement / conservation covenant later is sensible?

Go!

This strategy allows EB to gain valuable insights into the projects dynamics before navigating the intricate legal aspects of the s106 agreements.

This structure gives EB the opportunity to align conservation initiatives with the landowner's long-term goals and vision, enhancing the chances of successful habitat management and sustainability.

This approach fosters open discussions and encourages collaboration between EB, landowners, local communities and LPA. It also demonstrates EB's proactive commitment to sustainable development before formal agreements are finalised. This would enhance the broader success of the projects.

By setting ecological goals, initiating habitat creation and management efforts through leases and management agreements, we can kickstart conservation actions sooner, ensuring immediate impacts on biodiversity and ecosystems.

PRACTICAL IMPLEMENTATION

LANDOWNER ALIGNMENT

FLEXIBILITY AND COLLABORATION

Sensible Aspects

EARLY CONSERVATION ENGAGEMENT

While EB's immediate actions demonstrate commitment, landowners might seek assurances that the ecological benefits are backed by legally binding agreements which, as per the current structure, are only formalised at a later date.

The delay between completing leases and finalising s106 agreements and conservation covenants may introduce regulatory uncertainties, potentially causing unanticipated disruptions and impacting the project timeline.

One challenge is ensuring seamless integration between leases, management agreements and s106 agreements. Careful consideration is required to ensure that the terms across these agreements are consistent and coherent.

COMMUNITY PERCEPTION

REGULATORY RISK

Considerations

LEGAL ALIGNMENT

Conclusion

In conclusion, the approach of completing leases first, followed by s106 agreements and conservation covenants is sensible due to its early engagement, flexibility and practicality. It allows EB to demonstrate immediate positive actions, align with landowners and gain insights into project dynamics. However, careful legal consideration, regulatory risks and landowner perceptions are considerations that must be managed to ensure the success of the strategy.

Question 2

Do you have any suggestions on how the process could be improved to minimise cost and risk to Environment Bank?

Go!

Scenario Planning:Develop risk mitigating strategies that account for unforeseen circumstances. Being prepared for such scenarios will safeguard EB's projects, financial investments and survivability.

Regular Training:Maintain a deep understanding of evolving regulations. Proactive compliance reduces the risk of penalties and ensures EB's actions align withlegal frameworks.

Cross-Functional Teams:Foster collaboration amongst cross-functional teams. Their collective insights can address challenges comprehensively, minimising costly misshaps.

Standardised Templates:Develop standardised template agreements adaptable to specific projects and various clauses applying to different circumstances. This reduces the time and resources spent on drafting and streamlines negotiations.

Suggestions for Risk Mitigation

Suggestions for Minimising Costs

Question 3

What elements of these transactions will our funders (Gresham House) be particularly focused on?

Go!

Gresham House's Key Focus Areas

Understanding GH key priorities will be pivotal to ensuring a successful partnership.

Financial viability of EB's projects.

EB's track record of successful projects.

Exit strategies and mechanisms for releasing returns on GH's investments.

EB's strategies to identify and mitigate potential challenges.

EB's commitment to environmental sustainability and whether these align with GH objectives.

How EB measure and demonstrate ecological impact of projects.

Question 4

What factors would you consider when deciding how best to structure these transactions?

Go!

My key considerations in structuring the transaction would be:

1. Project Goals and Objectives - Defining the primary goal of the projects is foundational.
2. Legal and Regulatory Framework - Adhering to legal and regulatoy framework is paramount.
3. Ownership and Land Rights - Clarifying land ownership and land rights is crucial.
4. Risk Assessment and Mitigation - Thoroughly assessing potential risks and developing mitigation strategies is essential.
5. All Parties Engagement - Engaging landowners, local communities, developers and LPA is critical.
6. Reporting and Accountability - Tracking progress, measure impact and demonstrate positive outcomes.
7. Exit Strategies - Outlining exit scenarios, while ideally ensuring continuity of conservation efforts.
8. Consistency Across Agreements - Integrating agreements seamlessly.
9. Environmental Impact Measurement - Incorporating methods to measure and verify ecological impact of EBs projects.