Globes, Guy Lieberman, 30.04.2020
The Strategic Housing Plan for 2017-2040, prepared by the National Council of Economics and adopted by the Israeli government, states that without large-scale urban renewal, the State of Israel will face real planning difficulties for the vacant land intended for construction in the center of the country," the petition says Published today for public scrutiny, titled "Removing barriers in urban renewal."
The numerical targets speak of hundreds of thousands of apartments to be built in the next 20 years as part of such projects. Against the concern of anyone working in the field, with emphasis on government and entrepreneurial factors, is that the way the field works today will not allow such mass building, due to a multitude of inherent barriers. In the past year, a team led by the Justice Department has worked to promote various measures, one of which is to accelerate construction within urban renewal projects. The report, parts of which were published in "Globes" earlier this week , point to the barriers, including a series of suggestions that its authors may provide an appropriate solution to the existing situation.
Have you "created" a garden apartment? You do not have any privileges
A key section that includes it indicates the existing situation where 80% of the condominium owners' consent is required in order to promote a project. In this context it is proposed to lower the required two-thirds majority. Another obstacle many entrepreneurs encounter in evacuation-construction complexes and who begin to sign tenants is the issue of dealing with the many construction offenses that exist in the area. Occasionally these are tenants who have taken up space from the common yard, creating a sort of "garden apartment". Or top-floor tenants who have arranged a roof apartment for themselves over the years.
In the current situation, many entrepreneurs, sometimes discreetly, try to reach financial arrangements with those tenants that are different from those offered to the other tenants. All in order to get the consent of those tenants, thus reaching the desired target of the percentage of consent required.
According to the report, it is proposed to establish a special arrangement for an owner who refuses a deal that has undergone a construction offense in the apartment that is the subject of the transaction. It is proposed to state that a reluctant dwelling who committed a construction offense will not be listed as a condominium owner in the same building (will not be considered a condominium owner in calculating "100%" of all condominium owners). This rule will apply where more than half of the condominium owners in the same condominium agreed to execute the transaction. In this situation, the tenant who commits construction offenses will only receive compensation for the legal construction he performed. For that matter, they will be seen as refusing an unreasonable refusal of the deal.
And here's another novelty, discussed, and Starm decided about it and about "recalcitrant". "In cases where the state is promoting a plan for urban renewal, and there is a significant public interest in urban renewal, it is suggested that the state could also file the lawsuit against the reluctant landlord," it said.
The report also offers a different reference to tenants who don't live in the property. For example, investors who rent apartments in a complex for evacuation-construction, or heirs who sell apartments, and more.
"Regarding condominium owners who do not reside in apartments, it was proposed to rule out a distinction between a situation in which condominium owners who do not reside in the agreement agree to a majority agreement. A conditional refusal of the condominium owners will not be taken into consideration. Unambiguous as to whether these apartment owners help in most cases to promote the project or constitute an obstacle to its promotion, and because of the difficulties this proposal may cause, it was decided at this stage not to establish a unique arrangement.
The report also includes a proposal that would reduce the power of multi-tenant tenants in complexes. "Regarding Section 4 of the Law (Evacuation and Construction Law, Encouraging Evacuation and Construction Projects. JL), which states that anyone who owns more than 30% of the dwellings will be considered the owner of only one dwelling, it is proposed to amend the section to bring about a more proportionate result, and determine "Anyone who owns more than 30% of the apartments will be considered only 30% of the apartments (and not as the actual ownership rate, which exceeds 30%)," the report says.
Make orderly improvements
In another chapter in a report detailing barriers to conduct with the authorities, there is a key recommendation regarding setting the improvement levy on urban renewal projects at 25%. The report suggests that in some areas that the municipality defines, the improvement levy can be received at a rate of 50%, and in which areas throughout the city the full levy of the improvement levy will be exempt. Entrepreneurs who are familiar with the field know that reform in this area alone can accelerate many projects, as they will gain significant certainty about the payments they need to pay as part of these complex ventures.
Another significant issue that comes up in the report concerns dealing with urban renewal deals that are not progressing optimally. In this context, it is proposed to set timeframes for the expiry of transactions in such a way that they are canceled as entrepreneurs fail to meet a certain stage. The proposal is to bring the transactions forward as quickly as possible.
Another issue in the report concerns familiar coping - two entrepreneurs and more who hold the signatures of tenants who embrace their power to carry out an evacuation-construction project in the complex. These situations often create delays and a real inability to advance projects. In this context, it is proposed to examine the establishment of a tribunal, which will enable him to resolve the conflict between the two developers, incentivize them to reach agreements between them, and reach a situation where only one entrepreneur continues the deal in the same building, and the contracts the tenants signed with him will be re-signed with the other developer.
The report also includes references to ethical aspects of attorneys representing tenants in an urban renewal project, though this issue is still in litigation with the bar.
Another recommendation seeks to abolish the declaration mechanism for evacuation-construction complexes and enact other arrangements in the legislation to obtain the incentives related to these complexes.
The report also refers to IDFs who need to continue in the coming years, and even more so, to take part in promoting urban renewal projects, thereby accelerating their promotion. In this context, it is proposed to extend the legislation that deals with the Housing Preferred Areas Committee, so that you can discuss the urban renewal plan. It is also proposed to establish a special route for approval of consolidation and distribution plans in urban renewal projects, through promotion and approval of the plan even without approval of consolidation and distribution tables when the approval of the tables will be postponed until the time of issuance of permits, and the tenants' consent will be obtained.
Implementing the recommendations? Not so fast
How close are we to actually implementing the steps suggested in the report? This is at least a few months. The present report is a proposal file only, with the public being invited to comment on it and submit references to it to the DOJ by May 14. Then another headquarters work will be done, in preparation for the final report. This work is then expected to constitute the infrastructure for various legislative amendments and procedures to be disseminated by different government units - in accordance with their responsibilities.
According to the report in the promotional initiative, the Deputy Attorney General (Civil Law), Adv. Erez Kaminitz, even endorsed the recommendations contained therein. The person who chaired the report preparation team is the head of a real estate cluster in the Department of Justice and Citizenship (Civil), Attorney Carmit Ullis. The work of the team was coordinated by Atty Esti Bass Verhaftig, and now coordinates the work of Attorney Rosslan Otman, both of the Law and Legislation Department in the Ministry of Justice. Finance, as well as VP of Urban Renewal, Einat Gannon, and IRS Frankel-Cohen.
Attorney Yishai Itzikowitz, director of the Real Estate and Urban Renewal Department at the Agmon & Co. office, Rosenberg HaCohen & Co., told "Globes" that "the realm of urban renewal is indispensable for real estate in Israel and therefore a critical tool for its development First and foremost, any initiative to remove barriers should be welcomed, "however, he points out some points on the" recalcitrant "issues that the report does not touch." The reform did not address the "reluctant building" phenomenon, with regard to most of what is required to promote a joint-home program in accordance with the regulations and Regarding the right to file a lawsuit against defiant apartment owners. According to the existing arrangement, a majority of apartment owners are required in each of the buildings included in the cluster, therefore, even if the majority of the required number of claims is reduced to 66%, the requirement to obtain a majority of the buildings (as long as it remains intact) can thwart and even prevent the Implementation of the project.
It is to be hoped that when the proposals raised in the reform are promoted under detailed legislative proposals, this will also be addressed. In the matter of recalcitrance, the issue of refusal or respect or delays on the part of the local authority also appears to be unanswered under the reform, and as long as the circumstances require support and backwash from the authorities in order for the project to be promoted (either within the framework of the VLM or in order to request a declaration) , In the absence of mandatory provisions or sanctions against the local authorities, we are left with a significant barrier.
True, there is sometimes a need for a local authority as a condition for promoting the project, therefore, within the reform, the authorities' reasonable needs must be addressed, but at the same time provisions should be enacted to promote projects, even where local authorities do not cooperate and even resist or pose difficulties for reasons that are not Justified. "
Deputy Director General of the Municipal Renewal Authority, Einat Gannon, said, "Urban renewal processes are very complex and we are trying to find ways to facilitate and accelerate their implementation. The role of the government authority is to help increase the scope of realization of the projects as much as possible, so that more and more tenants can live in safe and secure apartments. We will continue our thinking, and will continue to be attentive to the voices coming from the field and conduct regular consultations, with the aim of providing answers and solutions to the industry. "