Michelmores has advised on an innovative partnership between Environment Bank Ltd and specialist alternative asset manager Gresham House to introduce a first-to-market compliance solution driving biodiversity net gain (BNG).
Through establishing a nationwide network of habitat banks, Environment Bank’s BNG Credits offer developers a simple and risk mitigated way to implement biodiversity net gain in line with the Environment Act 2021, while also generating income for landowners.
Michelmores advised on the partnership arrangement between Environment Bank and Gresham House, structuring the suite of legal documents required to support the business model in line with the requirements of the Environment Act 2021.
Partners Alexandra Watson (corporate) and Ben Sharples (agriculture) led the team, drawing upon expertise from across the firm’s corporate, commercial, agriculture, real estate, tax and regulatory teams.
Partner Ian Holyoak and Senior Associate Chloe Vernon Shore advised on the commercial agreements; Partner Stephen Newson and Senior Associate Crispin Carpenter advised on property arrangements; and corporate Associate Adam Quint supported with the partnership arrangements.
James Cross, CEO of Environment Bank, says:
“We’re working closely with landowners to offer a solution that will help deliver sustainable development through the creation of woodland, meadow and wetland habitats. Our unique habitat banks provide a long-term opportunity for landowners to diversify their income, a biodiverse haven for plants and animals, and a simple, risk-free way for developers to meet changing regulations.
“Thanks to Michelmores expert advice and the support of Gresham House, we are able to offer an end-to-end solution for developers that are required to implement biodiversity net gain when it’s not viable to deliver on site.”
Alexandra Watson, Partner in the Corporate team at Michelmores LLP says:
“The new biodiversity net gain requirements introduced by the Environment Act 2021 are a game changer for any development after the transition period – this will heavily impact on developers and local authorities. In response, Environment Bank will be offering an end-to-end commercial solution through its partnership with landowners.
“It has been a pleasure to work with my colleagues at Michelmores, the leading teams at Environment Bank and Gresham House in tracking this ground-breaking legislation through Parliament and supporting them with the ongoing roll out of their business model as the secondary legislation comes through.”
Ben Sharples, Partner in the Agricultural team at Michelmores LLP, says:
“Natural habitats are key to locking up carbon, so the agricultural sector is in a unique position to help tackle climate change and dwindling biodiversity. This is why I’m delighted we’ve supported Environment Bank and Gresham House in this venture which is at the forefront of the biggest upheaval in land management since the Second World War. The depth of our agricultural knowledge, combined with the breadth of expertise across the firm, enabled us to create the documents which will deliver a solution that will benefit landowners, developers, local authorities and the environment.
“A new asset class has emerged with land providing vital environmental benefits. The race to net zero and the legal requirement for biodiversity net gain will mean that such benefits quickly acquire a substantial and quantifiable value. The next task is to assist a number of clients in providing a response to DEFRA’s consultation on the vital secondary legislation required in this area. Historically, farmers and landowners have shown their ability to adapt and by continuing to do so will no doubt unlock the full potential of this new opportunity.”