Eric Murkowski, globes.co.il

Are you part of an urban renewal project in planning? Pay close attention to the space between the new apartment you will receive and your current one.

An administrative petition filed two weeks ago in the Central District Administrative Court officially opened the next storm in this area, amid policy changes stemming from pressure from local authorities to reduce these areas of compensation by half of what they receive today.

While the local authorities are already talking about the days when the value of the new dwellings will shrink and homeowners will even have to pay some of their costs, so that evacuation and construction projects 38 have economic feasibility - the representatives of the developers and the owners of the apartments are furious.

The lawsuit filed in Central District is likely the first swallow for this storm. Aharon Tal, owner of an apartment on Cook Street in Netanya whose apartment is included in the evacuation-construction project, petitioned against the municipality of Netanya and the project's entrepreneurial companies, demanding that his existing apartment, as well as other apartment owners in the project, be added an area of ​​12 square meters (room) and a balcony Of 12 square meters, subject to the area of ​​the apartment not less than 60 square meters.

"The petition is against the new policy of the city of Netanya, which was recently accepted upon assuming the role of a new city engineer, in terms of limiting the remuneration received by tenants who own apartments in the city of Netanya in construction evacuation projects," said attorney Reuven Franco, who filed the petition. Franco points out that "the municipality refuses to honor any agreement between tenants and developers according to agreements signed with them many years ago, which were reported for real estate taxation and even made warnings about their rights."

The petition seeks to exclude the residents of the complex from the new policy, but the municipality refuses. The reason: Significant reduction of the downtown area. A few months ago, the municipality established an Urban Renewal Administration that conducted feasibility studies and planning restrictions on projects across the city.

"During her work, the municipality realized the need for a significant addition of downtown housing units, taking into account the city's infrastructure capacity: traffic and parking restrictions, road widths, public areas, dormitories, kindergartens, schools as well as sewer infrastructure, drainage, etc. From this, the professional team came to the realization that the extent of the housing units should be limited to each project, in order to allow as many buildings as possible to enjoy renewal while maintaining the principle of distributive justice among the city's residents, "the spokeswoman explains.

The municipality denies that the pledge or the residents of the project in question were once promised or made a commitment regarding the housing area. In fact, they say in the municipality, the plan was not deposited at all.

"The claim that the various programs were promoted a long time ago and that funds were invested in them does not affect the rule regarding the importance of overall planning," the municipality spokeswoman responded. "In this regard, a transitional directive was passed stating that plans already discussed by the local committee in an extended format under the old policy will be promoted in this way."

This story may be the first of its kind, but it won't be the last. Various municipalities are currently advancing a policy similar to that of the Netanya municipality, which includes reducing multiples - a ratio of the number of new dwellings to be built to the number of old dwellings - and the reduction of apartment space.

Last Thursday, the Petach Tikva Municipality released its policy of urban renewal: it offers a gross 12 sq.m. addition to the apartment (including a cadre); Additional space for the balcony 15% of the existing apartment space and not more than 12 sq.m.; The local planning and construction committee in Tel Aviv will discuss this week's Urban Renewal Urban Plan, which states, among other things, that the area of ​​each existing apartment will be added 12 sq.m., expressing an extra room for improvement. Housing welfare, provided that the minimum area of ​​the consideration apartment shall not be less than 60 square meters net.

To complete the picture, this weekend, the draft amendment to the Appraiser Standard 21 was published, which is intended to assess economists for construction evacuation plans, with a significant change compared to the original standard, which came out in 2012: while the source of the consideration received by the tenant in the new apartment reaches 25 square meters. It ranges from 12 to 25 square meters. As is evident from the three examples from Tel Aviv, Petah Tikva and Netanya, the authorities are trying to adhere to the minimum threshold, which reflects the addition of a room to the previous apartment.

Municipalities: People will have to add from their pockets

"I expect that we will see more and more of these in crowded areas that also have a multi-storeys planning limit. We may also see situations where tenants are participating in the cost of building to make the Tama 38 project financially viable," says 15th Forum CEO Eitan Atia. "Once more municipalities make master plans for urban regeneration and may set height or number of floors in some areas, conservation or other planning considerations, then people may need to add something out of their pocket to make the Tama 38 demolition and construction project possible."

To rely on the local authorities and the municipal renewal authority - this is a maturation process undergoing the urban renewal industry. Until recently, municipalities have not looked at this issue with an overall look, but have satisfied themselves with project examinations; Recently, the effects of the projects are not only examined on the street and the surrounding area, but on the whole of the space, and it turns out that the infrastructure restrictions are far more severe than previously thought.

"The municipality doesn't care about the entrepreneur's economic calculations, but you can't add a lot of floor space to any part of it. Take, for example, the old buildings in central Tel Aviv and the Old North, in the area where the UNESCO Declaration applies. The skating of each small building. That means you can't add a lot of floor space, because there is simply nowhere. In terms of height you can only build 5.5 stories - land + 4.5 stories,” Atia demonstrates.

"So if you now have a four-story building - land + three stories or an office basement + three stories above it - and you want to demolish and build a new building, and you also have a height limit of up to 5.5 stories, that means that the entrepreneur has no economic viability. That should be enough in just a floor and a half, and with it finance the demolition, construction, evacuation of tenants for alternative housing during construction and more. That's why every 3rd quarter of the Old North is stuck and has no 38th demolition and construction. There is no economic feasibility for the entrepreneur. His profit fails to exceed 17% -18%. In such a situation he cannot get a bank escort.

"In such a situation, tenants have to compromise their demands, if they want to be evacuated, to give up Bolthop's kitchen, perhaps to give up underground parking that includes a huge cost of digging and preventing groundwater, and maybe even funding their own stay while building a replacement housing."

"I think it's not so bad if an owner of an apartment in the heart of Tel Aviv's demand neighborhoods and other areas of demand in the center puts a few tens of thousands of shekels out of his pocket to get a new, strong, durable and modern building, which will also be subject to the planning rules that apply in the same area. The same apartment owner is selling his property for over NIS 1 million. A bad investment. "

It should be borne in mind that the things that Atia says are mostly true of the high-demand areas, where most of them also have a strong economic population. The economic equation that Atia does not always exist outside these regions.

Government: People will understand that it pays for them

The reduction required by the municipalities has the backing of the government and the director of the municipal renewal authority, Haim Avitan, explains, "It is in order to produce more financial for the projects, in order to get started. Certainly, the consideration for tenants is a crucial part of the economic viability of the projects. Tenants understand this and are ready to get a new apartment with the addition of a room, which of course is more protected from earthquakes.

"Even in the new Standard 21, which we are about to issue with the government appraiser and the board of appraisers, we are changing some clauses, one of which is for tenants' compensation, which will be between 12-25 square meters per tenant, and this is in accordance with apartment sizes. If there is a 50 square meter apartment, then give 20-25 square meters; The 90-100 sqm apartment will add another 12 sqm which is a room plus a balcony. This formula is good for everyone and so a lot of projects got underway. "

Avitan is confident that the public will understand this, and denies the possibility that tenants like Tal, who will hear about reducing the land they will receive in exchange for agreeing to share their apartments in evacuation-construction projects and TAMA 38, will not rush to sign the projects.

"They understand that they are getting a new and upgraded apartment and it is worthwhile and economical for them and the value is twice as high and therefore it pays for them," Avitan believes.

Contractors: Upholstery Urban Renewal

Haim Feiglin, Vice President of the Israel Builders Association, is in no hurry to agree with this statement and applaud the emerging change: "I think any such intervention is unnecessary and unnecessary and damaging. There are many apartments in the old 30-50sqm neighborhoods, which is what we built in the 1940s and 1950s. If you add 12 square meters to them, you won't get anything, and the tenants will refuse. They will feel that this is not a reason to enter into such a project and they will become reluctant. This sweeping intervention is simply damaging. And there are many such apartments on the market. "

Feiglin has a thesis on this. He says that what is burdensome about urban infrastructure is mainly the number of apartments and not their area, although the premise is that larger apartments are home to more people. "The more they push down on what the developers want to give tenants, they have a reason to push the multipliers down as well," he said. He believes that reducing the territories is a complementary step to abolishing Tama 38, by the authorities.

"The rationale for canceling TAMA 38 was that while we are eliminating TAMA 38, we will open up the complexes and evacuate construction. , He says, concluding: "Overall, the picture is not good, and many local authorities are teasing every urban revitalization: both the 38th TEMA and the evacuation of construction."

So, who is right? Is Avitan optimistic that the public will rush after construction evacuation projects even if they receive low permits, and maybe even Atia who is already talking about spending money out of pocket for the public to participate in various projects in order for them to donate? Or maybe Feiglin who thinks the real trend is to block any possibility of urban renewal, by making apartment owners reluctant? We will see the answer to that in the industry in the coming years.