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A regional developer
Over a period of three years, a brownfield city centre site was redeveloped into residential use with commercial units at ground floor.
The contaminated former industrial site suffered from dispersed industrial solvents in surface soils and elevated levels of toxic metals across the site, along with asbestos in soils. The remediation strategy required the removal of contaminated materials, and gas protection measures to the new development along with the provision of barrier water pipes. Asbestos was also removed from the existing structure during demolition works.
Value of LRR:
On analysing all of the development expenditure we identified that £250K had been spent on remediation costs that qualified for LRR. If the developer had been profitable, this would have generated a £375k tax deduction. However, due to the development making a loss, the relief was surrendered for a cash payment of just over £60k from HMRC. This effectively subsidised the cost of the clean-up works by about a quarter.
Developing brownfield sites can be complex and unknown elements in the ground can upset cost plans. Having an available cash payment certainly helps developers take on these more challenging sites.