Urban Renewal

Local Authority Pathway (”Authority Pathway”) – A local authority submits proposals to the Inter-ministerial Committee for Urban Renewal in complexes which it deems suitable for Evacuation and Construction in accordance with the principles of established threshold conditions. Should the Committee find that the complex meets these principles, it recommends that the government declares it an Evacuation and Construction complex – a declaration that grants government funding for preparing statutory planning documents as well as management and coordination of planning.

The “Taxation” Pathway (”Entrepreneur’s” Pathway) – The preparation of the plan is performed by a private entrepreneur, and the main point thereof is the demolition of existing structures and the construction of new structures in their stead. The Taxation Pathway operates under the Land Taxation Law (Betterment and Purchase – 5723-1963) and is meant to economically incentivize urban renewal processes conducted by private sector actors. Entrepreneurs submit a request to the Inter-ministerial Committee for Urban Renewal to recommend that the government recognizes a complex as an Evacuation and Construction complex for a period of six years, during which evacuated residents benefit from betterment tax, purchasing tax and VAT tax reliefs for the construction services.

Thickening and Construction – a pathway with the purpose of additional construction without the need to demolish the existing structure. The new construction is fairly moderate and is conducted as the addition of floors or the building of a new wing. This pathway is uncommon (only 15 Thickening and Construction projects appear in the Ministry of Construction and Housing’s website).

TAMA 38 – A pathway established in a National Outline Plan approved in 2005, with the purpose of reinforcing structures built before 1.1.1980 against earthquakes by providing economic incentives such as increased building rights. The worthwhileness of such projects stems from the possibility of adding new residential units to a building, in a pillar level (if one exists) and in 2.5 additional floors. The program also enables enlarging the existing apartments by an area of up to 25 m2 for each residential unit. The program provides exemption from payment of betterment tax and sale tax (Land Taxation Law, Betterment and Purchasing, Amendment 62 – Temporary Order 5768-2008) and an exemption from improvement levy (Planning and Construction Law, Amendment No. 96, 5771-2011).

Amendment 2 to TAMA 38 – this amendment permits demolition and reconstruction of the building in accordance with the building rights established in the local outline plan that applies to the lot, with the addition of all building rights added under TAMA 38 (that is to say, expanding the apartments by an area of 25 m2 per apartment and adding floors). The amendment allows apartment owners to benefit from rights provided under two sources: rights under the specified local outline plan and rights under TAMA 38. This alternatives also allows residents to enjoy the engineering benefits of a new building, with all that entails. Exercising this program, which emerged from the need to reinforce the buildings against earthquakes, harbors an opportunity for apartment owners to enjoy significant improvement of their apartment’s value.

A policy document by the Tel Aviv Municipality regarding TAMA 38 – licensing bodies at the Tel Aviv Municipality have formulated a guiding document for reviewing applications for building permits submitted under TAMA 38. The document focuses the terms for receiving a building permit under TAMA 38 and allows the local committee to review the applications in an informed, professional and consistent manner – and the apartment owners to assess the options they have for exercising TAMA 38. Part A of the document presents the terms for receiving a building permit, including the presentation of a confirmation for the need to reinforce the structure, the proposed method of reinforcement and other constructive documents to be reviewed by the Municipality’s construction consultant – the approval thereof is a condition for continued handling of the application for a permit. Part B of the document presents general policy outlines that apply to the entire city, according to which an application for a building permit under TAMA 38 is to be reviewed. Among other things, it outlines the policy for combining addition construction under TAMA 38 and addition construction under previous detailed plans, guidelines for cases where demolition and reconstruction of a building are required, guidelines regarding exceeding building lines, constructing protected spaces and more. Part C of the document presents the regional policy. This chapter outlines the policy for possible addition construction in various areas of the city under TAMA 38 – areas where additions under TAMA 38 are permitted, areas where such additions are permitted with the exception of adding floors, areas where new plans would permit more addition construction than the TAMA permits (2 floors and more) and areas where addition construction under TAMA 38 is restricted by the provisions of detailed plans that locally apply (usually in areas with a unique fabric deemed deserving of protection, such as the neighborhoods of Neve Tzedek, Kerem HaTeimanim and the Heart of Tel Aviv area). Licensing bodies routinely update the document per applicable changes in TAMA 38 and complementary legislation. On 29.11.2015, the Appeals Subcommittee of the National Planning and Building Committee approved the program concerning Quarters 3 and 4 of Tel Aviv. Quarters 3 and 4, located in the city center, have unique qualities due to the urban fabric which realizes the combination between the cultural aspect and the landscape morphology. Quarter 3 includes Dizengoff Square, Habima Square, Rabin Square, the Tel Aviv Port, the Basel Complex and more. The boundaries of this quarter are Ibn Gabirol Street to the east, the sea shore to the west, the Yarkon river to the north and Bugrashov Street to the south. Quarter 4 is located in the New North, bounded by Ibn Gabriol Street to the west, Ayalon Highway to the east, the Yarkon river to north and Shaul Hamelech Boulevard to the south. In recent years, many objections have been submitted to the Quarters Plan – both on behalf of apartment owners who sought to increase building rights and on behalf of the Council for Conservation of Heritage Sites in Israel and other bodies who sought to reduce the scope of building rights, claiming that approved additions damage the urban fabric and may even jeopardize the declaration of the White City area as a world heritage site. After a period where planning was brought to a standstill due to the dozens of objections and appeals submitted, the Appeals Subcommittee of the National Planning and Building Committee, headed by Adv. Moshe Golan, approved the Quarters Plan pertaining to Quarters 3 and 4 of Tel Aviv (with the exception of those buildings defined for preservation). Click here to read the decision in full.

A skilled contractor with much experience in building new neighborhoods in open areas will struggle to handle construction works in dense urban areas.

“Ram Engineering”, the company’s contractor arm, is a Class C5 contractor in residential building (an unlimited classification, and the highest one) and has the knowledge, expertise and proven experiences in performing works with advanced technologies for deepening foundations, moving structures, relocation of infrastructures and excavating parking lots. “Ram Engineering” has a vast body of experience in performing works in Tel Aviv, including in dense areas – and currently, among other things, it performs works for establishing the light rail in Tel Aviv.

2 | Experience with work in dense areas
Performing works in dense areas demands experience and a proven ability to handle the challenges such works entail – including meeting the strict requirements of licensing and oversight bodies, handling disruptions to traffic and to the everyday lives of the residents of nearby buildings, and working opposite multiple interfaces.

3 | Financial robustness and the capability to finance its operations via equity capital
In addition to the guarantees required from entrepreneurs, it is important to verify that the entrepreneur is capable to bring the project to fruition and meet their obligations towards the apartment owners. Ram-Mograbi-Arditi’s control holders are people of means with a high grade of financial robustness, and operate with particularly low leverage, which guarantees the upholding of the companies’ undertakings towards apartment owners in full.

4 | Experience with complex licensing processes and familiarity with licensing bodies at the Tel Aviv Municipality.
The licensing process for receiving a permit, particularly in the Tel Aviv and Center areas, necessitates experience and profound familiarity with the National Outline Plans, familiarity with the Quarters Plan, understanding the Municipality’s policies and familiarity with the licensing system at the Tel Aviv Municipality and its Planning Committees, and the ability to navigate between the guiding principles of the Planning Committees. Ram-Mograbi-Arditi’s control holders have 40 years of experience in planning, promoting and approving Urban Building Schemes, specializing in the city of Tel Aviv. The company’s control holders also consult and accompany steering committees on behalf of the Ministry of Construction and Housing, and have a wealth of knowledge and experience in the planning and licensing processes in Tel Aviv.