Charities Act Valuation and Section 119 Reports
Harding Chartered Surveyors provides independent RICS advice for charities selling, leasing or otherwise disposing of land in London and the South East. For many disposals, trustees must obtain and consider a written report before agreeing terms. The correct advice depends on the transaction, the property and whether Charity Commission authority is required.
When Does a Charity Need a Section 119 Report?
For most sales, leases involving a fine or premium, options, easements and other disposals, trustees must obtain and consider a written report from a designated adviser acting exclusively for the charity. The report should comply with the Charities (Dispositions of Land: Designated Advisers and Reports) Regulations 2023. Where a RICS Registered Valuer provides the valuation, the valuation element can also be prepared in accordance with the RICS Red Book.
For a lease without a fine or premium, trustees must instead obtain advice from someone they reasonably believe has the ability and experience to give competent advice on that lease. Different requirements may apply to acquisitions, mortgages, exempt charities and disposals that fall within a statutory exception, so trustees should also take appropriate legal advice.
What Harding's Charities Act Advice Covers
Harding's RICS Chartered Surveyors advise on charity property transactions across London and the South East. We inspect the property, review the proposed terms and provide an evidence-based opinion of value and disposal strategy for trustees to consider.
Depending on the instruction, our report can address:
- the current market or rental value and the effect of the proposed terms;
- the most appropriate method, timing and marketing of the disposal;
- works, planning potential or alternative uses that may improve the terms obtainable; and
- any other property matters the trustees should consider before agreeing the transaction.
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What Does a Section 119 Report Cover?
Section 119 of the Charities Act 2011, as amended by the Charities Act 2022, governs the advice requirements for many charity land disposals. Since 14 June 2023, the legislation uses the term designated adviser rather than qualified surveyor and trustees have more discretion over how a proposed disposal is marketed.
A compliant report is tailored to the transaction and should address:
- the value of the interest and the effect of the proposed terms;
- whether improvements, planning or other changes could enhance value;
- the most appropriate method and timing of disposal;
- whether and how the property should be marketed; and
- other recommendations that may help the trustees obtain the best terms reasonably available.
Trustees must consider the report and be satisfied that the proposed terms are the best reasonably obtainable for the charity, unless a statutory exception applies. They should keep a clear written record of their decision and explain any decision not to follow a recommendation.
Why Use a RICS Chartered Surveyor?
When Is Charity Commission Authority Required?
Most charity land disposals can proceed without prior Charity Commission authority when the trustees have the power to dispose and follow the statutory advice and decision-making requirements.
Authority is generally required when the proposed disposal is to a connected person, when trustees do not follow the relevant advice or best-terms steps, or for many disposals of designated land. Designated land is property that must be used for a particular charitable purpose, such as a school or recreation ground.
Trustees should therefore:
- confirm that the charity owns the land and has power to dispose of it;
- obtain and consider the correct report or advice before agreeing terms;
- identify connected-person, conflict and designated-land issues early;
- obtain Charity Commission authority where required; and
- record why the disposal is in the charity's best interests and how the terms were assessed.
A solicitor should advise on the charity's powers, any necessary authority and the statements required in the transaction documents. Harding can provide the property valuation and designated-adviser advice; see also our RICS Red Book valuation service.
CC28 and CC33: Which Guidance Applies?
CC28 is the Charity Commission's guidance for selling, leasing, transferring or otherwise disposing of charity land in England and Wales. It explains when reports and Charity Commission authority are required.
CC33 concerns acquiring land. It recommends that trustees consider appropriate professional advice and, in many cases, a designated adviser's report, but it is not the disposal guidance.
These guidance documents help trustees understand the process but do not replace advice from the charity's solicitor or other professional advisers.
Before instructing us, it is helpful to provide:
- the property address and title information;
- the charity's governing document and any trusts affecting the land;
- the proposed sale terms, lease or heads of terms;
- details of tenancies, occupational arrangements or connected parties; and
- relevant planning, building and development information.
We will confirm the appropriate valuation scope and any information still required before inspection.
Choosing the Right Designated Adviser
Trustees should choose an adviser with the appropriate professional qualification and experience of similar land in the same area. A RICS Chartered Surveyor is one type of designated adviser recognised by the 2023 Regulations.
Relevant factors include:
- experience of the property type and local market;
- the ability to assess the proposed transaction and valuation basis;
- appropriate professional standards and insurance; and
- acting exclusively for the charity while identifying and managing conflicts.
Harding's report supports the trustees' decision; it does not replace legal advice or make the decision for them. Trustees remain responsible for acting in the charity's best interests and securing the best terms reasonably obtainable.
Request a Charities Act Valuation
Harding provides Charities Act and Section 119 advice for residential and commercial charity property across London and the South East. Our reports combine local market evidence, a clear valuation basis and practical recommendations.
Please send us the property address, proposed transaction and any available title, lease or heads of terms. We will confirm the appropriate scope, fee and likely timescale before you instruct us.
Request a free, no-obligation quote or call 020 7736 2383 to discuss the property with our valuation team.
