Knotweed treatment can increase land bank values

Timely treatment of Japanese knotweed infestations can reap major longer term cost-saving benefits for landowners and significantly increase the value of their land banks.

That's the advice from leading treatment specialists, Japanese Knotweed Control which believes that with preventative work potentially aided by government tax credits there's never been a better time for developers to initiate treatment programmes.

Japanese knotweed is the scourge of many a property developer.

Not only does it cause a reduction in land value and physical damage to foundations and structures, but government legislation also puts a duty of care on the landowner to be proactive in its control and eradication.

The Land Remediation Relief (LRR) under the Finance Bill 2009, which came into effect at the start of this month, allows tax deductions for the cost of treating naturally occurring land contaminants, including Japanese knotweed and is a timely introduction as the latest growing season gets under way.

As of 1 April, bodies liable for corporation tax can claim a significant deduction on expenditure removing Japanese knotweed.

Japanese Knotweed Control is, however, still encountering cases of developers that are paying the price for delay.

Visiting a new development in Cheshire recently, for example, the company was disturbed to hear that the site had fetched an attractive GBP2.3 million sales price only to be compromised by a quote of GBP750,000 to eradicate its Japanese knotweed infestation before the transaction could proceed, effectively writing over a third off the total land value of that site.

The irony was that for an initial treatment programme of some GBP10,000 the developer could have had total, warranty-protected eradication of the knotweed across the entire site, long before the development came to market.

Sadly, it's an all too familiar story that the company has seen repeated with local authorities, retailers and house builders in recent months.

Joint managing director, David Layland comments: "In the current economic climate, developers and land owners need every help they can to increase their land bank values and a pre-emptive, preventative treatment programme is one sure-fire way of ensuring that when a developer takes its site to market they are fully protected against any potentially 'deal-breaking' knotweed eradication clause".

"Developers should be treating contaminated land while we're in a downturn in preparation for when things start to pick up and they can potentially save a fortune by clearing a site in-situ rather than costly and non-environmental off-site removal once the problem has escalated".

"Hopefully the latest tax credit incentives will further persuade developers of the importance of pre-emptive treatment programmes," said Layland.

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