Bill opposed

Investor pulls out of deal amid land reform fears

Sarah-Jane Laing: a lack of rationale in the proposals (pic: Terry Murden / DB Media Services)

An investor has pulled out of a deal to acquire a substantial estate in Scotland over proposed reforms to land ownership.

The identity of the potential buyer and the target has not been disclosed but it is said to be a 10,000 acre estate valued at “sub-£15 million”.

Land ownership experts say the collapse of the deal is likely to be followed by similar withdrawals if the Scottish Government introduces changes to the way transactions are conducted.

The Land Reform Bill will enable ministers to intervene in the sale of land and, if necessary, dictate that it should be sold in lots. The proposed change in the law also imposes new requirements on consultation.

It is designed to diversify land ownership which is seen to be in the hands of too few wealthy individuals. Landowners say the bill betrays a lack of understanding of land ownership and that by “gambling with the future of communities”, it will disrupt transactions and depress real estate values.

Sarah-Jane Laing, chief executive of the Scottish Land & Estates, told a media briefing today that the bill also undermines the delivery of renewable energy and housing – “things that the government wants to develop”.

The bill sets two thresholds of 1,000 and 3,000 hectares as points where the reforms kick in, with the lower figure equating to an average Scottish glen. Ms Laing said there was no rationale for the thresholds.

She added that commercial forestry owners and investors were particularly concerned and had put “tens of millions of pounds of investment on hold”. She said they needed to protect access and storage associated with forested land.

“There is a lack of understanding of basic economics,” she said as she outlined the SLE’s 46-page response to the bill.

“There is growing evidence that management of land at scale has positive outcomes for the environment and communities.

“Some of the measures proposed present serious consequences not only for the owners of land but also for people, jobs and nature. This is gambling with the future of rural communities.”

She said SLE had been in talks with Mairi Gougeon, the Cabinet Secretary for Rural Affairs, Land Reform and Islands, and had been encouraged by Labour leader Anas Sarwar’s comments to the organisation’s conference last week.

Anas Sarwar told the SLE conference he wanted to work with landowners (pic: Terry Murden)

“He said he was talking to us, not as landowners, but as a business organisation and that was a welcome move,” she said.

Stephen Young, SLE’s director of policy, added: “If these plans are introduced it will require more government staff to administer it. We are talking here about millions of pounds of public money.”

Patrick Colquhoun, assistant CEO at Luss Estates, said he could not understand what problem the legislation was trying to solve.

“This legislation seems completely unnecessary,” he said. “We are fearful of our ability to deliver.”

Crawford Mackay, partner at rural property consultancy Galbraith, who revealed the withdrawal of the estate buyer, said: “The proposals have the potential to bring an array of legal, financial and technical implications, and unintended negative consequences to the Scottish land market.

“As drafted, the proposals include restrictions on the disposal of small areas of land within villages, where a member of the community may wish to extend their garden or business.

“The proposals are also likely to capture the sale of residential developments, where each and every house sale would require the prior approval of Scottish ministers.

“By embarking on this process, without a clear timescale and reference to property professionals or owners, the proposals appear likely to create further uncertainty and so reduce confidence and investment in both the agricultural and environmental land market in Scotland.”

Land Commission defends proposals

Michael Russell, chairman of the Scottish Land Commission, said it supports the aims of the Land Reform Bill aim to address “longstanding issues associated with concentrated land ownership in Scotland”.

He said: “The Bill’s proposed measures, including lotting – the dividing up of larger units of land for sale – are significant steps towards addressing the impacts of concentrated land ownership in Scotland.

“Our research shows that the effects of concentrated land ownership are far-reaching, impacting how people can work, live and grow in communities. The proposal for large land holdings to work more closely with communities and publish plans outlining how they intend to use their land will help to increase transparency and disclosure.

“Although the proposed transfer test differs from the public interest test recommended by the Commission, we believe that the inclusion of lotting could make more land available and look forward to consideration of how this approach can have most impact .”

In its submission to the Scottish Parliament’s Net Zero, Energy and Transport Committee, the Scottish Land Commission has drawn on research, including an investigation into issues associated with the scale and concentration of land ownership and a review of international practices. As well as reflecting its practical experience over three years of our Good Practice Programme.

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