Real Estate Focus – April 2025

Martyn’s Law Update - Terrorism (Protection of Premises) Bill receives Royal Assent

On 3 April 2025, the Terrorism (Protection of Premises) Act 2025 (the Act) received Royal Assent. Known as "Martyn's Law" (in tribute to Martyn Hett who was killed alongside 21 others in the Manchester Arena terrorist attack in 2017), its aim is to improve protective security and organisational preparedness of certain premises and events by requiring those responsible for them to put in place measures to reduce vulnerability to terrorist attacks.

We covered the main points in our November 2024 Real Estate Focus, but with the UK government providing more clarity on timescales for implementation and publishing initial factsheets on the main aspects, here is a reminder of the essential points for potential duty-holders.

Which types of premises and / or events are in scope?

The government has published guidance confirming that, in order for a premises to fall within the Act, it must satisfy the following criteria: 

• there must be at least one building on the premises, which could consist of part of a building, and/or include a building along with other land;
• the premises must be used mainly for one or more of the uses specified under schedule 1 of the Act - this includes a wide variation of uses including shops, places of worship, entertainment and leisure activities and sports grounds. 

For an event to be in scope it must: 

• take place in a building, on land or at a combination of the two;
• have specific entry conditions (such as a ticket or a pass, or be for members or guests of a club); and
• be accessible to members of the public. Events arranged by other types of body, for example corporate events for employees, weddings or private events do not fall within the scope. 

What are the obligations and who is responsible?

The Act establishes a two-tiered approach linked to the number of individuals it is reasonable to expect may be present at the same time at premises and events. 

Anyone who is responsible for a premises or events having a potential capacity of between 200 and 799 individuals (a "standard duty" premises or event) is under obligations to:

• notify the Security Industry Authority (SIA) of their premises or event; and
• have in place, so far as is reasonably practicable, appropriate public protection procedures. 

The standard duty requirements should be centred around simple, low-cost activities expected to reduce the risk of physical harm being caused to individuals. This could involve evacuation, invacuation (moving people to a safe space) or locking down the premises along with communication with individuals. 

Anyone who is responsible for a premises or event with a potential capacity of 800 or more individuals (an "enhanced duty" premises or event) is under the same obligations as for standard duty premises / events, but in addition will be required to:

• have in place appropriate protection measures to reduce both the vulnerability of the premises or event to an act of terrorism, and the risk of physical harm being caused to individuals if an attack were to occur - this could include enhanced security and monitoring of the premises and their immediate vicinity;
• produce to the SIA a document setting out details of the measures in place, including an assessment of how the protection measures reduce vulnerability; and
• where a responsible person is not an individual, designate a senior individual with responsibility for ensuring the requirements are complied with. 

How will Martyn's Law be enforced?

A new regulatory function will be established within the SIA which will seek to support, advise and guide those responsible for premises and events in meeting the requirements. Where there is serious or persistent non-compliance the SIA can take enforcement action including compliance notices, monetary penalties and restriction notices. The legislation also includes some criminal offences. Guidance will be published in the future on how the SIA will discharge its functions under the Act, but this will require approval by the Home Secretary before publication.

Next steps

The government has indicated that the main provisions will not be in force for another 24 months or so. This will allow the SIA's new function to be established and give those responsible for in-scope premises and events sufficient time to understand and prepare for their new obligations. During this time, the government will produce more detailed guidance on the various aspects of the Act.

However, with its wide application to a variety of buildings it is prudent for those responsible for complying with the relevant duties to start planning now. This will entail the consideration of new or enhanced procedures and training staff on new measures implemented.

The National Infrastructure and Service Transformation Authority (NISTA): A strategic shift for the UK's infrastructure future?

Following the UK government’s announcement of the merger of the National Infrastructure Commission and the Infrastructure and Projects Authority in 2024, the National Infrastructure and Service Transformation Authority (NISTA) has come into existence from 1 April 2025. NISTA is intended to play a pivotal role in reshaping how major infrastructure projects are planned, executed, and delivered across the UK. This initiative is a direct response to concerns about the rising costs, delays, and inefficiencies that have long plagued the UK's infrastructure sector.

Why NISTA?

In a report issued by the National Infrastructure Commission (NIC) in 2024, it was revealed that one of the primary causes of soaring costs in UK infrastructure projects is a "lack of clear strategic direction." This lack of cohesive leadership has led to common issues such as projects running over budget and missing deadlines. NISTA will bring together the functions of the NIC, which assesses the UK’s infrastructure needs and offers independent advice, and the Infrastructure and Projects Authority, which monitors the delivery of projects. By combining these responsibilities, NISTA will oversee the entire lifecycle of infrastructure projects from strategic planning to final execution.

NISTA’s creation is in line with the government’s broader infrastructure strategy. The new authority will play a central role in delivering the UK’s ambitious 10-year national infrastructure strategy, set to be published in spring / summer 2025. This strategy will cover a wide range of essential policy areas, including:

• Housing: Delivering 1.5 million new homes by the next general election in 2029.

• Education and Healthcare: Improving school buildings, constructing new facilities, and modernising hospitals.
• Clean Energy: Scaling up renewable energy generation capacity and supporting innovative green technologies like carbon capture and storage (CCUS) and green hydrogen.
• Transport and Connectivity: Investing in road and rail improvements, as well as electric vehicle charging infrastructure.
• Data and Technology: Facilitating the development of data centres to drive AI and business innovation.

While these goals are ambitious, the NIC warned that they are at risk of not being met unless systemic issues in infrastructure delivery are addressed. The NIC’s report pointed to critical drivers of project cost, including poor planning, lack of innovation, and failure to manage the project lifecycle effectively. In particular, the NIC emphasised the importance of getting the planning and scoping stages right to reduce costs and delays. Effective design, repeatability, and innovation could cut costs by 10-25%, offering significant savings over time.

Government commitment to infrastructure delivery

The establishment of NISTA is part of a broader government strategy to address these challenges. NISTA will oversee the development and implementation of the new infrastructure strategy, ensuring that projects are delivered more effectively and efficiently. Importantly, the UK government recognises that infrastructure development must involve both public funds and private sector investment. In this regard, the Treasury has made it clear that the private sector will play a crucial role in funding infrastructure, with the government committed to fostering a stronger partnership with businesses. This includes exploring funding opportunities such as the new National Wealth Fund, which aims to unlock investments from pension savings, potentially boosting pension pots by an average of £11,000.

Forging a path 

The government’s commitment to infrastructure reform, led by NISTA, signals a transformative shift in how the UK will manage its infrastructure needs in the years to come. By addressing the root causes of cost overruns, improving strategic direction, and fostering greater collaboration between the public and private sectors, the UK can unlock the potential of its infrastructure to support economic growth, climate resilience, and technological advancement.

As we look ahead, the data centre investment landscape will continue to be strongly shaped by market dynamics, technological advancements, and evolving regulatory frameworks. Investors must stay agile and informed to navigate this complex and rapidly changing environment.

Boundary demarcation agreements - binding on successors in title, notwithstanding lack of knowledge: the case of Darren White v Michael and Sheila Alder [2025] EWCA Civ 392

The issue 

On 7 April 2025, the Court of Appeal handed down a judgment which addressed the enforceability of boundary demarcation agreements. The central legal question which the court had to consider was whether a boundary agreement between previous owners of adjacent properties bound successors in title, even if the new owners had no knowledge of it. 

The facts 

The case involved Mr White (the Appellant) who was the owner of Willow Cottage and Mr and Mrs Alder (the Respondents) who were the owners of the Old Stores, the neighbouring property. Both properties were purchased in November 2005 and an oral agreement regarding the boundary between the properties was made in October 2005 between the previous owners, which was later documented in writing. In 2016, the Appellant demolished part of the boundary wall and began constructing an extension to Willow Cottage. In response, the Respondents alleged that this construction trespassed on their property (the boundary of which had been confirmed by the boundary agreement between predecessors) and that further acts of trespass occurred in 2019. 

The Appellant argued that the boundary agreement was not binding on successors in title, and, in the alternative he should not be bound by the boundary agreement as he did not have knowledge of it. 

The first instance judge held that the boundary agreement between the predecessors did bind successors in title, notwithstanding they had no knowledge of it. However, the judge granted permission to appeal to the Court of Appeal who was asked to clarify if such agreements generally bind successors and whether they apply to a purchaser without notice of them. 

The outcome 

The Court of Appeal agreed with the first instance trial judge, disallowing the appeal, and clarifying the position on boundary agreements. 

It distinguished between different types of boundary agreements, namely: 

• those that constitute an exchange of land and effectively transfer the interest in land from one person to another; and
• those by which the parties merely intend to "demarcate" or clarify an unclear boundary referred to in title documents - known as "boundary demarcation agreements". 

Boundary demarcation agreements  have a proprietary effect, thereby binding successors in title. This is because they establish the physical extent of the respective legal estates created by the conveyance or transfer. In addition, as they are neither equitable interests or overriding interests in registered land, consequently there is no requirement for prior knowledge of any such agreement. 

The implications

This case has provided further clarity on the nature of boundary agreements, and confirmed that, where an agreement is entered into to clarify the true position on the ground, then it is binding on successors in title, even if those successors have no knowledge of the agreement at the point of sale and purchase. 

The Land Registry has already updated its guidance on how boundary agreements work, referring specifically to this case, and confirming that an agreement to demarcate an unclear boundary is binding on parties and successors, even if they had no knowledge of it. 

The case reinforces the fact that where a Buyer wants to carry our works on or near the boundary with an adjoining property it needs to do as thorough an investigation as possible as to where the boundary lies and what agreements might have been entered into in connection with this.

Tax update

Major projects: tax certainty

In a welcome move, the Treasury is consulting on a new process for increasing the tax certainty available in advance for major project investments. The aim of the new process is to enable businesses to discuss certain projects with HM Revenue & Customs (HMRC) in order to obtain certainty on the tax treatment, within a suggested 60-day timescale, in respect of those areas of most value to a project.

The consultation sits alongside other ongoing work on improving tax certainty for investment by providing clearance for the transfer pricing implications for cost contribution agreements and the availability of research and development tax reliefs. With the necessary expertise in place, the reforms have the potential to be highly beneficial, providing greater confidence for return on investment projections and the fundamental economic viability of these large-scale projects. A number of areas are open for input, and while the financial threshold for eligibility has not yet been decided, the consultation is clear that the process is intended for the very largest major investment projects, and to pick up dozens rather than hundreds of projects annually.

Implemented and resourced well, the proposed reform has the potential to be exciting news for high-value infrastructure and construction investment, an area where there has long been uncertainty – as reflected by the significant body of case law on areas such as availability of capital allowances and tax treatment of financing costs.

Court of Appeal decision: capital allowances and predevelopment expenditure – offshore wind farm

In mid-March, the Court of Appeal published their decision in Gunfleet Sands, upholding the taxpayers’ appeal on the availability of capital allowances for predevelopment expenditure on offshore windfarms. The Upper Tribunal had taken a narrow approach to what expenditure could qualify, and found that only “the making/construction of the plant, transportation of the plant and its installation” could qualify for capital allowances. On that basis, none of the expenditure on technical or environmental impact studies carried out by the taxpayers was expenditure “on the provision of plant or machinery”.

The Court of Appeal provided a tripartite test for the availability of capital allowances, which are available where the following conditions are met:

• the taxpayer can demonstrate that, looking at matters objectively and with the benefit of hindsight, expenditure informed the design of plant or machinery or how it was to be installed,
• the expenditure related to plant or machinery which was in fact acquired or constructed, and
• the expenditure did not arise from characteristics or circumstances particular to the specific taxpayer.

Applying this test to the facts of Gunfleet Sands, the Court of Appeal held that all of the contested expenditure on studies carried out by the taxpayer was qualifying capital expenditure “on the provision” of plant and machinery.

In the Autumn Budget 2024, the government committed to publishing a consultation on the tax treatment of predevelopment costs, but has stated that it is now considering the implications of this case for the consultation, and so the next steps for the consultation remain unclear for now.

Reserved Investor Funds

In the Autumn Budget 2024, the government confirmed that the Reserved Investor Fund (Contractual Scheme) (RIF) would be introduced by April 2025. New regulations came into force in March 2025, enabling the RIF - a UK-based investment fund vehicle, which is structured as an unauthorised co-ownership alternative investment fund.

The introduction of the RIF, modelled on the existing co-ownership authorised contractual scheme but with the key difference being that the RIF is not itself authorised by the FCA, is welcome. The RIF had been dubbed “the onshore JPUT”, and it is expected to be attractive for certain funds or club deals that intend to invest predominantly in UK property and for exempt investors that do not want the additional complexities of the Exempt Unauthorised Unit trust regime or pension fund pooling scheme arrangements.