Hectares

Asset Realisation
Asset Realisation

Overview

Asset realisation is the sale of assets such as land and buildings to generate a one-off income.  The land is likely to be peripheral to the core function of the site.  For example part of the site could be sold for housing, community facilities or agriculture.

Buildings could also be peripheral to the core activities of the site.  Alternatively they could be a core feature such as a restaurant.  It may be beneficial to sell core buildings to transfer the liabilities and management of the building to another organisation.

In any sale of assets clear covenants should be included to ensure that any future uses do not have a detrimental impact on your site.

The sale of assets is dependent on having a buyer.  Buyers can include house builders, local authorities and even homeowners wanting to increase the size of their garden.

The sale of any assets can be highly contentious.  The local community is often likely to be against the loss of any park space.  The acceptance or resistance to any sale of assets will depend on what is being sold and who it is being sold to.  Selling assets to enable developments such as house building or for industrial uses are likely to encounter strong opposition.  Also any assets considered core to the heritage and identify of a site will probably be unpopular.

Selling assets can often be a lengthy process (more than a year) for example finding a buyer, completing site surveys and obtaining planning permissions can all take time. Therefore it should not be viewed as a quick way to generate income.

Questions to Consider

The Land is suitable for
Do you have any surplus assets on your site?

The Land is suitable for
Do you know of any potential buyers for your assets?

The Land is suitable for
How will the local community respond?

The Land is suitable for
Will the sale affect the heritage of the site?

Pros and Cons

The Land is suitable for
Reduces size of site and therefore maintenance costs.

The Land is suitable for
Generates a one-off lump sum.

The Land is suitable for
Does not have many costs involved.

The Land is suitable for
Allows you to focus on core activity.

The Land is suitable for
Only generates a one-off income.
The Land is suitable for
Selling assets can be a lengthy and time-consuming process.
The Land is suitable for
Public could be opposed to the sale.
The Land is suitable for
Could damage the reputation of the site if assets are sold.