Commercial property lawyers under increased pressure to avoid costly farmland remediation issues

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26 February 2013

  • Soaring farmland prices heap pressure on lawyers to conduct thorough due-diligence
  • Remediating contaminated land costs 40 times more than its purchase price
  • Part 2A of Environmental Protection Act could leave cost of remediation with new land owners
  • SearchFlow launch comprehensive environmental search for rural land transactions

The rising price of farm and agricultural land has increased the pressure on commercial lawyers to identify the environmental risks and opportunities associated with it, according to SearchFlow, the property search provider.

The price of farmland has rocketed over the last two years, with growth rates similar to those seen in prime residential property in central London.

The average price of farmland across Great Britain increased 12.3% in 2012 following a previous hike of 8.2% in 2011. This leaves the current price tag for an average acre of land at £6,058. This rise has come despite falling crop yields over the last year. The yield (tonnes per hectare) of all cereal crops, for example, fell 11.1% between 2011 and 2012.

Richard Hinton, business development director of SearchFlow said: “The rising cost of farmland is putting ever-increasing pressure on farmers to get a return on their investment. This, in turn, is heaping pressure on commercial lawyers to ensure the most rigorous due-diligence is carried out on farmland. It’s the only way to ensure issues with the land and enormous financial outlays can be avoided in the future.

“We’re not talking small change here. The cost of cleaning up contaminated land is over 40 times more than the average cost to purchase it. And if those responsible for the contaminating the land in the first place can’t be found, the cost will fall to the current owner. This means liability could well land at the door of the lawyer involved.”

The cost of cleaning up contaminated land now stands at around £250,000 per acre, 4,027% more than the current average price per acre (£6,058). These costs can double, triple or worse if contaminated land that has not been remediated by the previous occupier produces run-off into other sites.

Report launched to help commercial lawyers

In response to the increased risks associated with land purchases, SearchFlow has launched a report that delivers specialist due diligence tailored for the purchase, refinancing or redevelopment of agricultural land and farms.

The report, called GroundSure Agricultural, contains a full contaminated land risk assessment and professional opinion covering the essential requirements of part IIA of the Environmental Protection Act and provides insight on relevant past and current use of the land and site layout.

The opinion on site suitability provides support for banking security and valuation purposes, together with a more tailored wide-area search than standard commercial searches.

Richard Hinton said: “This report offers a single view of all potential risks for rural land, ensuring clarity on the situation ahead of deals being finalised. There are no generalisations, every report is backed by IEMA-qualified environmental consultants and further action assessments are further scrutinised to deliver a completely individual opinion of a site. With the stakes so high for farmers at the moment, we are offering this valuable search to help ease some of the pressure that comes with buying farmland.”

In addition the report delivers:

  • Agricultural land classification, indicating the potential productivity of the land;
  • A screening of flood risks as well as details of hydrogeology;
  • Details of historic rights of way, sites of ancient or protected woodland and archaeological sites of interest;
  • The land’s proximity to the potential threat of build disruption or purchase risks associated with the development of the High Speed (HS2) rail route; and
  • Non-coal mining risks and related subsidence hazard.

For more details of GroundSure Agricultural or any of the reports provided by SearchFlow, please visit

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