Dov Cohen ,calcalist.co.il.

In light of the decision to extend the validity of TAMA 38, the National Building Strengthening Plan, for a further three years, beyond the time limit for its May 2020 expiry, many urban renewal projects we relied on may not be implemented.

In light of the uncertainty about the new plan to replace TAMA 38, apartment owners who want to renew their buildings should take advantage of the time remaining wisely, and most importantly - to act quickly. Despite the tight schedules, this is a feasible task, if properly implemented.

Attorney Michelle Arad, of the Arad Luxembourg Law Firm, offers a recommended course of action to promote resolutely and efficiently projects within urban renewal, before the new plan comes into effect:

Step 1: Preventive activity of the apartment owners

In the first stage, the owners must be active, and prove that they are serious about their intentions. They must show, especially to themselves, that they want to go into a lengthy process that also involves stress and discomfort, in the hope that it will eventually pay off. Therefore, each TAMA 38 project begins with the meeting of a condominium association for appointment of owner's representatives. The appointment must be subject to the following conditions:

A. To appoint the owner's representation through a protocol, which will be signed by 80% of the rights owners in the building whose apartment is adjacent to 80% of the common property in the building.

B. It is advisable to appoint a representative from each wing or apartment type in the building.

third. An odd number of delegation members must be appointed to enable the delegation to have an effective decision-making mechanism

D. It is recommended to include in the protocol the powers given to the members of the delegation, including the selection of the professional bodies that will accompany the owner during the project, including a lawyer, building inspector and real estate appraiser. The owner's representative must then choose these entities, both for the choice of the entrepreneur and for guidance during the project. These teams should include at least a lawyer specializing in urban renewal projects and a building supervisor, and a power of attorney for escort and representation must be signed.

Step 2: Preliminary feasibility study for the Tama 38 project

The initial feasibility study for compliance with the TAMA 38 requirements is carried out by the professional team that accompanies the owners. Among other things, the building year and its area are being tested to make sure that it meets the initial law requirements for buildings to which the TAMA 38 applies. Legal feasibility study by the attorney accompanying the owner.

Step 3: Construction rights testing and initial economic feasibility

The land assessor on behalf of the owner conducts an examination of the building rights on the lot, as well as examines the economic feasibility of the Tama 38.

Step 4: Create a preliminary technical specification which will be attached to the Entrepreneur Tender

After reviewing the rights and economic feasibility, the owner's representative and the building inspector on their behalf can produce a preliminary specification, which will contain requirements regarding the level of finishing details for the new building and the new owner's apartments.

Step 5: Preparing an Entrepreneur Tender, Distributing and Controlling the Proposed Bids

The owner's attorney and the building supervisor on their behalf prepare a tender containing legal questions, venture threshold requirements and requirements relating to the desired technical specifications. Subsequently, the tender is distributed through an owner-lawyer to at least three entrepreneurs, with the aim of obtaining bids that closely match the requirements of the tender.

Next, the lawyer reviews the developers' proposals: Do they have experience and provide references for their financial ability to execute the project ?; Did the bids of the developers include required answers to the tender sent ?; Is there a commitment by the developers to clear schedules for the different project stages ?; He also makes sure that there is an obligation on the part of the developers to provide collateral to the owners as required by the tender.

At the same time, the Supervisor on behalf of the owner must ensure that each entrepreneur has made an initial measurement of the existing owner's apartment space, including the porch area that is closed and annexed to the apartments, and to ensure that the developer included in the proposal the area of ​​their future apartment. In addition, he must make sure the initial floor plan and the typical new floor in the new building will be built, and check that these scripts comply with the relevant local committee's instructions and requirements, in accordance with existing plans and policies in the same local authority.

The professional team on behalf of the owner will review all the proposals received, will sort and submit any necessary corrections or clarifications. Next, the amended proposals will be reviewed in accordance with the requirements of the owners and advisors on their behalf.

Step 6: Select an Operational Entrepreneur

The owner's representative, in collaboration with the project management team, formulates a recommendation for an entrepreneur or several entrepreneurs. Subsequently, a condominium meeting is held with the participation of the professional team, in order to present the selected developers' proposals and make a decision on choosing an entrepreneur. The owners will advance to sign a binding legal agreement to execute the project.

Subsequently, a contractual agreement is entered into between the developer and the owner through the owner's lawyers and the chosen entrepreneur. The agreement is signed by the selected developer and apartment owners (at least 80% of the owners with 80% of the common property adjacent to their apartments).

Step 7: Prepare a building permit application

After the agreement is signed, the developer will, through the chosen project architect, make a request for a building permit for the proposed building. The application will include, among other things, the developer’s obligations regarding the new owner’s apartments including location, space, internal planning, parking, warehouses and more.

Step 8: Decision of a local permit committee on conditions

After applying for a building permit, the developer must make a decision by a local committee approving the permit application subject to certain conditions, which will be completed for the purpose of obtaining the final building permit. The owners and advisors on their behalf will be updated from the developer at the time the permit is granted.

Attorney Michelle Arad Photo: Arad Luxembourg

Step 9: Issue a building permit

After completion of all the conditions specified in the local committee decision, it is the responsibility of the selected developer to issue a building permit for the project. When it comes to the type of building demolition and rebuilding project, the owner must vacate their apartments between 90 and 120 days after obtaining the permit, but not before the required guarantees are deposited. Among other things, these guarantees include a sale law guarantee at the value of the new apartment, a guarantee to secure the rents to the owner for the construction period, a guarantee to ensure the payment of taxes to the tax authorities and the insurance policy signed by the lawyer on behalf of the owner.

Step 10: Begin construction under the eye of a tenant inspector

At the beginning of the work, the building inspector on behalf of the owner makes sure that the developer, through the contracting contractor, builds according to the building permit obtained from the local authority, according to the obligation of the apartment owners and in accordance with the prescribed schedule. When the construction is completed, at the time the apartments are handed over to the owner, the inspector will check to see if there are any building defects. If so, it will prepare an appropriate protocol for the required repairs.

Step 11: Finish construction work and test period

After the completion of the construction work, receipt of a settlement form for the new building and delivery of the new apartments to the owners, a period of check will be defined which is defined in the legal agreement. During this period, the developer will repair construction defects specified in the owner's inspection protocol, or those discovered after the apartment was delivered. It is customary to include the provisions of the Sale of Apartments Law (1973) on the responsibility of the developer to carry out repairs, even if the law does not apply to it.