GUIDANCE: DISPOSAL OF PROPERTY
APPLICATION AND INTERPRETATION
1.
This Guidance is intended to be read alongside Property: Acquisition, Disposal
and Management and is designed to provide further information on the disposal of
property, plant and equipment i.e. property rights in land and buildings, plant and machinery
and vehicles.
2.
Any queries on the application or interpretation of this Guidance should be referred
to Property Division. Property Division is also happy to advise on any specific points arising
from any of the Guidance, including appointment of professional advisers, disposal at less
than market value and use of the Guidelines on Transfer of Property in the Scottish Public
Sector. Contact PropertyDivision@scotland.gsi.gov.uk or telephone on 0131 244 4523.
BACKGROUND
3.
A property disposal involves a number of steps which are needed to conclude to a
satisfactory sale. Some steps are particular to the Scottish public sector. The following is
not a definitive guide but highlights some of the points that disposing bodies must consider.
IDENTIFYING ASSETS FOR DISPOSAL
4.
Holdings of property, plant and equipment should be regularly reviewed in line with
the organisation’s strategic plan. Once assets have been identified as surplus they should
be sold as quickly as possible, usually within 3 years, subject to the need to obtain the best
price reasonably achievable and reflecting any conditions imposed by the disposing body.
Residential property should be sold within 6 months of becoming vacant. To achieve value
for money for surplus assets organisations should either:
a.
b.
c.
obtain the best possible price on the open market, or
dispose of an asset at less than Market Value to deliver wider public benefit,
consistent with Best Value principles, or
transfer under the Guidelines for the Transfer of Property within the Scottish
Public Sector.
5.
When evaluating options for the treatment of surplus assets, consideration of the
acquisition of assets by community bodies should be included, where appropriate. This
consideration should be consistent with the principles of Best Value, where wider public
benefits may be achieved.
6.
Any work to make the property more attractive to purchasers e.g. repairs, masterplanning or seeking an improved planning consent, should be undertaken to enable the
disposal to proceed within this timescale. If no sale is in progress within these time scales,
the disposal strategy should be reviewed and alternative methods of disposal considered.
7.
Where a property forms part of a larger property or estate and greater benefit would
accrue from its being managed or disposed of as a single asset, advice should be sought
from Property Division.
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REQUIREMENT TO SEEK PROFESSIONAL ADVICE
Requirement to consult Property Division
8.
When the disposal of an asset is being considered, business areas within the
Scottish Administration (core SG, Crown Office and Procurator Fiscal Service, SG
Executive Agencies and non-ministerial departments) must seek advice from the SG's
Property Division. Other organisations to which the SPFM is directly applicable may seek
advice from Property Division on a voluntary basis or, in the case of bodies sponsored by
the SG, where required to do so under the terms of their framework document. There are
specific exceptions to this requirement. [Link to appendix detailing the exceptions to scope])
Legal Advisers
9.
The SG Legal Directorate (SGLD) does not undertake conveyancing work. External
solicitors must, therefore, be appointed to deal with any disposals, except in the case of
Transport Scotland and such other bodies as have their own arrangements. In all cases,
suitably qualified and experienced solicitors must be used. Property Division can assist with
making an appropriate appointment under the SGLD Framework Agreement for the
provision of Property Legal Services.
10.
Transfers of property between separate accounting entities where ownership
remains with the Scottish Ministers do not, however, entail the transfer of title and the
involvement of any appointed solicitors should cease as soon as such a transfer is set in
motion.
Valuation Advice
11.
Prior to any disposal, it is important to obtain professional advice covering valuation
and negotiation for all but the smallest and non-contentious disposals, i.e. where Property
Division estimates the value to be less than £20,000.
12.
The valuer used must be a professional member of an appropriate body, such as the
Royal Institution of Chartered Surveyors or the Institute of Revenues Rating and Valuation,
and suitably qualified with sufficient current local and national knowledge of the particular
market, and with the skills and understanding to undertake the valuation competently.
Selection of the valuer is to be guided by value for money considerations, weighing the
expertise and service offered against the cost. There may be circumstances in which a
valuer (external or internal to the organisation) may be unable to act in a particular case. In
any event, where a matter is deemed by the Accountable Officer to be novel or contentious,
a suitably qualified and experienced external Valuer should be used to provide valuation
advice.
Marketing Agent
13.
It is normal to appoint a marketing agent in open market sales. The agent must be a
firm with specialist knowledge of the market for the particular type of property involved and
its locality. The expertise of agency firms varies considerably and Property Division can
advise on a range of appropriate firms. In some cases such as house sales in localities
where the bulk of such sales are carried out by solicitors then a solicitor estate agent with
wide and appropriate experience of the property market concerned may be employed.
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Planning and Other Professional Advice
14.
Normally, advice should be sought on development potential to obtain the best use
and value. In cases where planning consent is not sought the need for a Planning Gain
Sharing Agreement (PGSA) or Overage clause in the sale agreement must be considered
and the professional adviser’s views formally recorded. The PGSA or Overage clause
should be highlighted in the marketing strategy.
15.
Consideration must also be given to the most cost effective method of procuring
additional services e.g. Home Report and Energy Performance Certificates, which may be
required before the property can be offered for sale.
Appointing Advisers
16.
Normally appointments of professional advisers will be by way of Framework
Agreements with professional firms that have been pre-tendered, existing Service Level
Agreements or by competitive tendering. Property Division can assist in selecting a firm or
undertaking a procurement exercise in order to make an appointment.
Supervision of Advisers
17.
To ensure that value for money is achieved and that high standards of propriety and
transparency are maintained, staff and advisers must be carefully supervised and clear
separation of responsibilities kept between the valuation and disposal processes.
Disposal of Assets
18.
Where there are wider public benefits, consistent with the principles of Best Value, to
be gained from a transaction, disposing bodies should consider disposal of assets at less
than Market Value. This includes supporting the acquisition of assets by community bodies,
where appropriate. Otherwise, assets are to be disposed of at Market Value, as defined in
the International Valuation Standards (as used in the Royal Institution of Chartered
Surveyors Valuation Professional Standards) but reflecting any special value and the effect
of any voluntary conditions imposed by the seller.
19.
Where an asset is being disposed at less than Market Value, a market valuation is
needed as part of the process of considering the wider public benefits alongside any
financial implications. A market valuation will enable accurate accounting and reporting.
20.
Guidance and support is available to ensure options appraisals are comprehensive
and appropriate budgetary provision is in place. When an asset is being transferred at less
than Market Value, it must be approved in advance by Ministers, taking into account advice
from the SG’s Finance Directorate/Health Finance, SG’s State Aid Unit and, where
appropriate, the SG’s Property Division. SG will assist with examining any affordability
issues, accounting and reporting requirements where a disposal may constitute a Gift, and
any potential State Aid implications.
21.
Consideration should be given to where anticipated receipts from the disposal of an
asset are part of an agreed funding package to support approved projects, including those
in procurement. Any VAT consequences should also be considered. All such disposals
should be supported by analysis that demonstrates clearly that the transaction represents
value for money.
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Disposal of tied houses and sales to other sitting tenants
22.
Scottish Ministers are not bound by the Right to Buy legislation i.e. the Tenants’
Rights Etc. (Scotland) Act 1980, the Housing (Scotland) Act 2001 and subsequent
enactments. However, the same principles should be applied administratively in cases
where a house which is occupied as a condition of employment, is declared surplus.
However, in certain circumstances the normal presumption that sitting tenants of such a
tied house will be offered the house in which they live on Right to Buy terms can be
overturned with Ministerial agreement. This might occur where the disposal of the dwelling
might prejudice the value of land retained by compromising an access, or if it needs
services to be maintained over neighbouring ground.
23.
Where a tenant is not occupying the property as a condition of employment, they
may be offered the opportunity to purchase their home, but not at discount. If the property is
not offered on the market, such a sale may be regarded as potentially concessionary.
Advice on procedures, discounts etc. is available from Housing Supply Division. Any
discount would qualify as a Gift and be subject to the procedures described in the section of
the SPFM on Gifts.
24.
It is the intention of the Scottish Government to end Right to Buy and so, this
provision will also come to an end. It is anticipated that the Right to Buy will come to an end
around summer/autumn 2017.
DISPOSAL OF HISTORIC BUILDINGS
25.
A historic building is a listed building, a scheduled ancient monument, or any building
in a designated conservation area. Historic Scotland should be contacted for advice on the
status of buildings, the degree of permissible alteration for re-use, and the likely grant
situation a purchaser may face.
26.
The standard principles of disposal apply to historic buildings in that normally the
property should be sold on the open market, for the best price reasonably available after
securing the benefit of any more valuable planning permission and, where appropriate,
listed building consent for alternative use. However, in considering offers it is legitimate to
consider the wider costs and benefits of a proposal including the on-going costs of
maintenance, costs to the Scottish Ministers of grants to future owners and any benefits
accruing. If, taking these issues into account, an offer provides the highest Net Present
Value (or lowest Net Present Cost) after a "Green Book" appraisal, the offer may be
accepted even though it is not the highest offer. Property Division can assist with the
appraisal. The approval of the relevant Finance Business Partner (or equivalent) should be
obtained before accepting such offers.
27.
Where it will increase the chances of securing appropriate ownership and use of
historic buildings a method of disposal other than by competitive tender or public auction
(e.g. private treaty sale) may be considered. The approval of the relevant Finance Business
Partner (or equivalent) should be obtained before accepting such offers.
DEFINITION OF PROPERTY TO BE SOLD
28.
It is essential that there is clarity on what exactly is to be sold, including any rights,
burdens or conditions.
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29.
When only part of a property is to be sold it is vital that proposed boundaries,
accesses and rights over other land are carefully established both to safeguard the value
of the property to be retained and to maximise the value of the surplus property. Property
Division will advise on the creation of new boundaries, rights and accesses. The appointed
solicitors should be required to confirm existing boundaries, rights and accesses.
30.
In PPP projects the disposal of the land and buildings may be a subordinate
component of the whole. Nevertheless the extent of the property to be disposed by sale or
lease needs to be carefully defined and professional advice from Property Division and the
appointed solicitors is essential.
Development Potential / Mineral Rights
31.
Explicit professional advice should be obtained on whether or not there is any
potential for development which would maximise sale proceeds and identify any particularly
sensitive planning issues. Consideration should be given to any appropriate pre-sale
investment in improving the property for sale, which will increase the disposal proceeds.
Advice should be obtained from Property Division in any cases where development
potential might arise.
32.
Professional advice should be taken before demolition as this is likely to constitute
"development" and need planning or listed building consent.
Planning Gain Sharing Agreements (PGSA) and Overage
33.
If there are uncertainties about the planning position of a property or doubts about
the planning use which would achieve the best price, subject to obtaining such written
recommendation from the professional adviser, disposal may proceed without planning
permission being sought. However in such circumstances consideration should be given to
including a PGSA/Overage clause in the terms of sale. The PGSA/Overage are usually
subject to negotiation and the prevailing market conditions. However, it should cover the
whole or at least a substantial part of any increase in value attributable to the grant of
planning permission for an alternative use during a specified period of time after the
disposal terms have been agreed. In this case, missives of sale should include a
PGSA/Overage clause requiring further payment by the purchaser if circumstances occur
which trigger such a payment.
34.
PGSA/Overage has the potential disadvantage that a purchaser may not be
prepared to pay as high an initial price as in a straightforward sale. There may also be
practical difficulties in monitoring and enforcing the arrangement if the purchaser
subsequently becomes unwilling or unable to honour the obligations imposed. The
appointed solicitors should be consulted on the appropriate legal arrangements and
Property Division should be consulted on all other terms of sale. In all such cases the sales
particulars should indicate that a PGSA/Overage clause may be required.
METHOD OF DISPOSAL
Internal Advertising / Guidelines for Transfer of Property in the Scottish Public
Sector
35.
Prior to offering land and property assets for sale elsewhere, all disposing bodies to
which the SPFM or NHS Property Transactions Handbook is applicable, including bodies
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sponsored by SG, must notify Property Division of the surplus asset in order that it may be
internally advertised; a process known as The Trawl. An Internal Advertisement form
must be completed and submitted. This procedure provides a mechanism for the transfer,
at Market Value, of property held within the Scottish public sector. Where another body
which is party to The Trawl expresses an interest to acquire the asset, the transfer should
be undertaken following the Guidelines for the Transfer of Property within the Scottish
Public Sector. The Trawl takes one month and must be completed before commencing
marketing or entering into a commitment to sell elsewhere.
36.
Notification to Property Division of surplus land of less than 0.1 hectares is optional,
but should be considered on a case by case basis taking account of the likely interest in
such properties from potential transferees.
37.
If two or more bodies seek to acquire a property under the Guidelines, the matter
should be resolved by discussion between them. If agreement cannot be reached, the
matter should be referred to the Scottish Ministers for decision. To assist with the Ministers'
decision-making, the Chief Surveyor must be asked to comment on the property aspects of
the respective proposals. The price that individual parties might be prepared to pay for the
property will not be a factor in the decision making process. The price paid will be decided
by the independent valuer.
38.
Once the Trawl process has been completed with no other bodies having expressed
an interest in acquiring the asset, other methods of disposal may be pursued.
39.
Detailed information is available from Property Division.
Crichel Down Rules
40.
The Crichel Down rules apply, with a limited number of exceptions, to the disposal
of surplus Government land acquired by, or under the threat of, compulsory purchase
including acquisitions under the Blight provisions of Section 101 of the Town and Country
Planning (Scotland) Act 1997. A threat of compulsion will be assumed in the case of a
voluntary sale where the power to acquire the property compulsorily existed, even though it
was not used at the time, unless there is evidence that the property was publicly or privately
offered for sale immediately before the acquisition. The Rules exist to protect the interests
of former owners of property. The Rules may also apply where a property has been
acquired from another public body as the obligation may not have been extinguished.
Property Division and the appointed solicitors should be consulted on the disposal of all
such property.
Traditional Marketing and Sale
41.
It is anticipated that the majority of disposals will be undertaken using the traditional
method of appointing a marketing agent, advertising the property on the open market and
then on receipt of offers, concluding a sale. This well-tested route to disposal still has a
number of steps to be undertaken.
Valuation
42.
Before property is offered for sale on the open market a pre-sale valuation must be
obtained to establish a guide price. However, in major disposals or potentially difficult or
contentious cases an independent valuer should be appointed in addition to the marketing
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agents. The basis of valuation for the guide price is the market value of the property in
accordance with International Valuation Standards, but reflecting "special value" and the
effect of any voluntary conditions imposed by the seller. "Special value" reflects any
additional value accruing from a potential bid by a purchaser with a special interest such as
a sitting tenant, a neighbouring owner or an owner with a property, physically, functionally,
legally or economically associated with the property to be sold.
Appointment of Independent Valuer
43.
Property Division can advise if an independent valuer should be appointed, which
firms should be approached and on the terms of the appointment. A brief must be prepared
in consultation with Property Division and the appointed solicitors and a detailed plan
showing boundaries, access, servitudes and services crossing the site must be provided. It
should be made clear to the valuer in the brief that he/she is to consider potential
alternative uses or development values, and to consider whether or not there are likely to
be bids from special purchasers such as neighbours, or sitting tenants.
44.

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


The functions of the independent valuer should include:
establishing the initial guide price.
advising on whether the property should be offered for sale as a whole or in separate
lots.
advising on the range of offers which may be expected.
advising on the acceptability of any offers received.
advising on any authentic late or revised bids received, before the sale has become
legally binding.
45.
Where a sale is proposed at a price below the initial guide price, the independent
valuer should certify, jointly with the selling agent, that it is the best offer reasonably
obtainable.
Appointment of a Marketing Agent and Marketing of the Property
46.
The SG normally uses marketing and valuation services that have been subject to
competitive tender. The SG has access to a number of framework agreements from which
services may be procured, including frameworks for valuation, estate agency, auction,
planning advice and property legal services. If a special tendering exercise is required
Property Division can advise on the specification, assist in drawing up a short-list, liaise with
Scottish Procurement and Commercial Directorate and assist in interviews and analysis of
tenders.
47.
The marketing agent, in consultation with the business area responsible for the
disposal, will normally:
 undertake a full appraisal of the property, clarify legal matters with the appointed
solicitors, analyse the appropriate markets and advise on the type, extent and cost of
advertising.
 for residential property, to procure or provide a Home Report, prior to putting the
property on the market.
 prepare an advertisement and place it in appropriate websites, newspapers and
property journals. The advertisement and its cost must be agreed in advance with
the business area concerned.
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

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draft marketing particulars in consultation with the business area, and circulate them
to interested parties.
handle all contact with potential purchasers, including telephone enquiries, meetings
and correspondence.
arrange for the land and buildings to be inspected by or on behalf of potential
purchasers.
Where appropriate, agree a closing date for offers with the business area and the
independent valuer, if appointed, and advise all potential purchasers of the date and
time fixed for the receipt of formal offers.
receive open and assess offers. Where a closing date is set, a clear process must
be followed to ensure offers are only opened after the closing date. For sales of
substantial value, or special sensitivity, arrangements should be made for offers to
be opened by the business area or in the presence of their representative. Business
areas can ask for offers to be sent to their appointed solicitors for formal opening.
after discussion with the business area make a recommendation in writing as to
which offer to accept.
48.
Property Division and the appointed solicitors can provide advice to business areas
on all aspects of the agent/client relationship. This includes the handling of the disposal or
the arrangements for fees. Property Division will assist with monitoring the performance of
the marketing agent to avoid unnecessary delay and compliance with the SPFM.
49.
Once the property is on the market, all enquiries from prospective purchasers or their
agents should be directed to the marketing agent/solicitor handling the sale. If enquirers
approach the business area directly before the property is put on the market business areas
must not offer any advice on price, asking price or closing date. The onus is on the
purchaser to inform himself/herself about the property and make up his/her own mind.
On-line advertising
50.
Any surplus property that is being disposed of on the open market or leased by
bodies to which the SPFM (or NHS PTHB) is directly applicable should be advertised on
www.novaloca.com This website includes details of properties identified for disposal or
lease by both public and private bodies. There is currently a contract between Scottish
Enterprise and Nova Loca to allow a basic listing of properties for disposal in Scotland at no
charge. The marketing agent may also suggest other websites and these should be
considered on a value for money basis.
Sale by Auction
51.
In Scotland sale by auction can help where the planning situation is unclear, the
property is unusual or a swift open and transparent disposal is required. While sometimes
perceived as a last resort for difficult to sell properties, it can introduce a property to a
different group of buyers. Property Division have put in place a framework agreement with a
Scottish auction firm, and can assist bodies who wish to explore the auction route for
disposal.
52.
A property may be submitted to auction either as a first choice, or after a period of
marketing by alternative channels which has been unsuccessful. However, the marketing
strategy must be properly considered and it may be appropriate to consider the fee
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structure of any marketing agents to facilitate joint agency, if an auctioneer may be
appointed.
53.
Business areas selling at auction must seek professional legal and valuation advice
beforehand, as legal documentation is needed well before the auction date, and a reserve
price must be fixed, and approved by the business area. The auctioneer will advise on
reserve and guide prices. Formal valuation advice must be obtained from a Valuer. If an
independent valuer has been appointed he/she should be consulted by the
auctioneer/selling agent before a reserve price is fixed. Auction without reserve is not
normally recommended. The bargain is concluded on the fall of the hammer.
54.
Sale prior to the auction is not normal, and would only be done with the written
recommendation of the auctioneer and an independent valuer that this would secure the
best price, and potential bidders had been informed in enough time to avoid travel costs.
55.
In an auction, the auction firm will perform a similar role to a marketing agent, but
due to the nature of auctions, the procedure for obtaining and accepting offers is quite
different. They will also advise on reserve and guide prices, conduct the auction and handle
deposits.
56.
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

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The auctioneer will:
undertake a full appraisal of the property, clarify legal matters with the appointed
solicitors, analyse the appropriate markets and advise on the type, extent and cost of
advertising.
prepare an advertisement and insert it in appropriate websites, e-media, newspapers
and property journals. The advertisement and its cost must be beforehand with the
business area concerned.
draft a catalogue entry in consultation with the business area, and circulate the
catalogue to interested parties.
handle all contact with potential purchasers, including telephone enquiries, meetings
and correspondence.
arrange for the land and buildings to be inspected by or on behalf of potential
purchasers.
conduct the auction and handle collection and subsequent release of deposits on
settlement.
Deal with any post-auction offers, on auction terms.
57.
Attendance at an auction by legal advisers is necessary to answer potential bidders’
questions and afterwards to oversee signing of documents. Similarly Property Division (or
in-house property team) should attend in case the reserve prices are not reached and the
auctioneer receives post auction offers on auction terms. This enables Property Division
and the appointed solicitors to advise on the spot.
Private Treaty Sales
58.
Within the SPFM, the transfer of property under the Guidelines for the Transfer of
Property within the Scottish Public Sector is not classed as a private treaty sale.
59.
Sale by private treaty (i.e. between two parties without competitive bidding) should
be exceptional other than for sales to sitting tenants or where the relevant Accountable
Officer, in consultation with the relevant Finance Business Partner (or equivalent), is
9
prepared to defend it as a deliberate concession. The following guidance applies to those
exceptional cases:
 in opting for a private treaty method of sale professional advice, in writing, must be
taken.
 the private treaty approach should normally only be adopted when written
professional advice indicates a clear advantage over an open market sale. Examples
may include a tenant prepared to pay above the market value or an adjoining
proprietor requiring the property for expansion. In such circumstances the sale
should only be concluded where the professional adviser states in writing that the
price finally agreed is at least equal to the best price achievable on the open market.
 it may be necessary or desirable to break off negotiations even at an advanced
stage. Discussions should always avoid moral commitment and make it clear that the
Scottish Ministers retain the right to resile from the negotiations until the bargain is
formally concluded. All correspondence should contain a disclaimer compliant with
the Requirements of Writing (Scotland) Act 1995.
60.
The sale of a property to a selected purchaser by private treaty based solely on a
market valuation where the professional advice is that the sale might not have a financial
advantage over open market sale should be regarded as potentially concessionary. This is
because in the absence of a test of the market it is possible that the best price will not be
realised. Any such sale or scheme of sales should therefore only proceed if the relevant
Accountable Officer is prepared to defend it as a deliberate concession and with the
approval of the relevant Finance Business Partner (or equivalent).
Joint Development Vehicles
61.
Where unfavourable market conditions militate against conventional methods of
disposal, or there is a clear financial advantage to the disposing body, other disposal
structures may be considered, such as joint development vehicles. Any such approach
would, however, have to provide the best value for money option and meet standard
requirements with regard to propriety and safeguarding the public interest.
62.
Proposals for the disposal of property held by the Scottish Ministers by means of a
joint development vehicle must be approved by Property Division and the relevant Finance
Business Partner (or equivalent). The Finance Business Partner (or equivalent) should be
engaged to advise on value for money and to assess the prospective accounting and
budgeting implications. Any such proposals must also comply with the guidance of
Borrowing, Lending and Investment.
DISPOSAL OF LEASEHOLD INTERESTS
63.
Where the disposing body holds surplus property on a lease there are a number of
options which should be considered including the exercise of a break option, assignation,
surrender and sub-letting. Potential claims for dilapidations may arise. Advice on such
proposals should always be obtained from Property Division and, where appropriate, the
appointed solicitors.
64.
Because surplus property is to be disposed of as soon as possible, there are few
circumstances in which disposal by lease is appropriate. However, where property or part of
a property will be vacant for a significant period before it is either sold or returned to
operational use, then leasing the premises as an interim measure should be considered.
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Similarly, where disposal of part of a larger property may adversely affect the future use or
disposal of the remaining property, leasing may be considered. Advice should be obtained
from Property Division who will help the body prepare Heads of Terms for the solicitors
acting for the body and establish the market rent.
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DISPOSAL OF ASSETS: PROCESS
Delayed Disposal
65.
The Scottish Government does not hold land speculatively to await changes in the
market. In exceptional circumstances it may be preferable to delay disposal of a property
beyond the recommended period because the local market is overloaded, or because a
phased disposal would produce greater overall receipts. A decision to delay must be based
on clear advice from the professional adviser, normally the marketing agent and agreed by
Property Division. If a sale is likely to be delayed, a short term lease may be considered as
a strictly temporary measure. If the circumstances are novel or contentious, the relevant
Finance Business Partner (or equivalent) should be consulted.
Consideration of Offers
66.
Normally the highest offer will be accepted unless it is significantly less than the
guide price (or rent). An offer is particularly attractive if it is unconditional. Bids offering a
certain sum over and above the highest tender must not be accepted.
67.
There may be other circumstances when the highest offer is not the best offer.
Considerations relevant to an offer's acceptability include:
 where it is subject to conditions, and whether these are acceptable or can be
satisfactorily amended.
 the time to achieve completion of sale.
 the possibility of obtaining a better price by remarketing.
 the cost of maintaining the property if vacant. If security and maintenance costs are
significant, the business area should carry out an appraisal to determine the
improvement in price necessary to cover the additional costs of retaining the
property.
68.
Proposals to accept an offer against professional advice (i.e. Property Division, the
appointed solicitors or the independent valuer) should be cleared with the relevant
Accountable Officer and the relevant Finance Business Partner (or equivalent). The
Finance Business Partner (or equivalent) should also be informed about any case where
the disposal is of significant value and the offers are less than the independent valuer's or
marketing agent's valuation or are subject to unusual conditions. The approval of the
Finance Business Partner (or equivalent) should be sought before accepting any offers
which are less than the market value (or market rent).
69.
When considering bids for a lease of property, where factors other than rent are
material considerations in determining the successful bid, the details of the criteria, and
weighting of their importance, should be clearly set out in the particulars. In this case, bids
should be independently assessed by two or three assessors. Advice on this can be
obtained from Property Division.
70.
The European Commission has published guidance for Member States on the sale
of land and buildings by public authorities and it is important that these are adhered to. The
guidance states that sales should be conducted after an unconditional bidding procedure,
or alternatively on the basis of an independent valuation. Any disposal below market value
may be State aid - advice can be found at the State Aid Unit website and by contacting
the State Aid Unit.
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71.
Once it has been decided which offer to accept, the business area should instruct
the appointed solicitors who will inform the successful offeror and conclude missives.
Property Division is able to assist with decision making and ensuring instructions to
solicitors are clear. The marketing agent will inform the unsuccessful offerors. Any direct
approach made by an offeror to business areas after the appointed solicitors have been
instructed to accept an offer should be referred to the marketing agent.
72.
In major sales, the credit worthiness of the offeror should be examined before any
bid is accepted. This can be put in hand by the appointed solicitors, Property Division can
assist instructing them . Where agents are used to establish the credit worthiness of
bidders, business areas should ensure that they obtain in writing the advice and the nature
of the evidence on which it is based. This is particularly important for any higher bids which
are recommended for rejection because of doubts about the offeror's credentials.
73.
Once missives have been concluded by the acceptance of an offer, the appointed
solicitors will complete the transaction by handling the conveyancing.
Late Bids
74.
Under certain exceptional circumstances late bids have to be considered. However,
the duty to achieve the best possible price must be balanced against the risk of original
bidders withdrawing their offers because of the delay, and the risk of accusation of
impropriety in the marketing process. Any such bids must be discussed with Property
Division, the appointed solicitors, and the relevant Finance Business Partner (or
equivalent).
75.
Late bids or revised bids can only be considered where missives have not been
concluded and no commitment has been made to another offeror. The Scottish Ministers
must be seen to be scrupulously fair in dealing with offerors. It will also be necessary to
take the advice of the independent valuer (if appointed), the marketing agent, Property
Division, and the appointed solicitors. It will be wholly exceptional that such a bid will be
followed up and it will require the agreement of the relevant Accountable Officer. If it is
decided that such a bid has to be taken into account then the following measures must be
taken:
 all interested parties must be advised that the disposal is being reconsidered.
 if the exceptional bid is based on a different land use, the marketing agent must seek
the opinion of the Planning Authority on the likelihood of that use being allowed.
 the business area should agree a revised closing date with the marketing agent that
will give all interested parties a reasonable time to submit an offer.
 all previous offerors should be asked to submit a further offer by the revised closing
date or asked to maintain their previous offer.
CONCLUSION OF DISPOSAL
76.



When a disposal is concluded, there are matters to attend to, including:
updating the asset register (ePIMS or such other register as may be used)
local authority, FRU and SG rating advisers to be notified of cessation of liability for
rates
utilities providers to be notified of change in ownership
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