S106 Agreement Example

S106 Agreement Example Explained: What You Need to Know

If you`re in the development industry, you`ve most likely come across the term „S106 agreement” before. But do you really know what it means?

In simple terms, an S106 agreement is a legal document between a local authority and a developer. It outlines the developer`s obligations to provide community infrastructure or services, such as affordable housing, public open space, or education facilities, as part of their planning permission.

To give you a better idea of how an S106 agreement works in practice, let`s take a look at an example.

Example S106 Agreement:

Developer X has been granted planning permission to build a new housing development in a local authority`s area. As part of the planning permission, Developer X is required to enter into an S106 agreement with the local authority.

The S106 agreement sets out the following obligations for Developer X:

1. To provide 20% affordable housing within the development.

2. To provide financial contributions towards the improvement of traffic flow at a nearby roundabout.

3. To provide a financial contribution towards the maintenance of a local park.

4. To provide a new footpath linking the development to the nearby train station.

5. To provide a financial contribution towards the construction of a new school within the local authority`s area.

Once Developer X has completed the development and fulfilled their obligations under the S106 agreement, the local authority will issue a „completion notice,” which allows the development to be occupied.

It`s important to note that S106 agreements are legally binding, and failure to comply with the obligations set out in the agreement can result in legal action being taken against the developer.

In conclusion, S106 agreements are a crucial part of the planning process, ensuring that developers are contributing towards the community infrastructure and services needed to support their developments. By understanding S106 agreements and their obligations, developers can ensure they are meeting their responsibilities and contributing to the local community in a meaningful way.