An Additional Barrier in Performing TAMA 38 Projects

The Real Estate Law provides that in order to perform a TAMA 38 plan on a building under the “demolish and build” track, a majority of 80% of residents is required. In a precedential ruling, the Tel Aviv District Appeals Committee affirmed the Regional Planning and Construction Committee’s decision that in cases in which a new zoning plan provides more rights than those set in the TAMA 38 provisions, the consent of all residents is required.

The appeal was submitted against the Bnei Brak Regional Planning and Construction Committee’s decision to reject the execution of a TAMA 38 plan under the “demolish and build” track because of a resident who objected to the project. The resident argued that the “demolish and build” project was being planned as part of advancing a new zoning plan. Since this plan would have provided more rights than those set in the TAMA 38 provisions, it was subject to a different law, requiring the consent of all apartment owners, as opposed to the majority required by the Reinforcement Law.

The decision 

The Appeals Committee’s decision was supported by the explanation that the owners of rights in a condominium may not advance a plan whose goal is, inter alia, to make changes in an apartment whose owner has not consented to the changes. The decision was further based on the Planning and Building Regulations, intended to regulate the advancement of plans in a condominium. These regulations stipulate that a zoning plan that includes a change to the community property attached to a particular unit requires securing the consent of the unit’s owner.

The Appeals Committee concluded from these regulations that if such a rule exists with regard to the property attached to units, then certainly it should also be applied to the units themselves. Thus, the demolition of a unit should not be permitted without the consent of its owner. However, this decision excludes cases in which a “vacate and construct” plan is advanced.

It should be noted that a building permit under TAMA 38 may be issued without submitting a new zoning plan, in which case the Appeals Committee decision does not apply. Rather, the provisions of the Reinforcement Law, requiring a necessary majority of 80%, shall stand.

Still, the performance of urban renewal projects under new zoning plans is very common because such plans enable entrepreneurs to be granted additional building rights beyond those granted by TAMA 38, thus making investment in them more profitable.

At this stage, it seem the last word has been said, unless opponents appeal to the Administrative Court and a contradictory decision is handed down.

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Source: barlaw.co.il