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The field of urban renewal – which includes projects such as TAMA 38 and ‘Pinui/Binui’ (evacuation & reconstruction) – raises many questions. So that you may get the most professional answers and have full comprehension of the process involved, we have compiled a Q&A database for you. This will help you to understand the risks, the advantages and the various stages of the process. If you have any further questions that have not been covered here, please contact us and we will be happy to provide you with all the answers!

Why is it worth your while to choose our Company?

The ‘YTD’ company of the Israel Brothers Group is one of the leading companies in the field of urban renewal, and has a wealth of experience from over 55 years in the construction industry. The company operates with a sense of purpose in the field of urban renewal and, in addition to strengthening and protecting the buildings, the principle behind our extensive activities is the development and advancement of the city.
The group was founded by the Israel family, which has over the years established and initiated dozens of projects in Israel and abroad, including residential complexes, commercial complexes and shopping malls, logistics centers and hotels.
Projects in the field of urban renewal are implemented in collaboration with top ranking professionals, and provide the residents with new apartments which have been upgraded to a high standard of finish, with uncompromising attention to each and every detail.
Alongside professionalism, experience and economic strength, we place emphasis on the needs of our tenants and provide personal service and attention throughout the procedure, until handing over the keys to your new apartment.

What is the TAMA 38 plan?

TAMA 38 – which is an abbreviation in Hebrew which means “National Outline Plan 38” – is designed to protect and strengthen buildings against earthquakes. The purpose of TAMA 38 is to strengthen the structure and to add a safe room in buildings which were built prior to January 1980. As part of the process each apartment will benefit from the addition of 25 m2, which includes a safe room. The addition of the safe room and reinforcement of the building also strengthen the skeleton and the overall stability of the structure.
In addition – and in order to reinforce the entire building – the foundations and the existing pillars of the building are made thicker. In certain instances new support pillars might even be added.
The process is carried out by engineers, architects and professional consultants.

What are primary risk zones for an earthquake?

One of the factors that constitutes a risk of an earthquake occurring in Israel is its proximity to the African-Syrian rift. The primary danger for injury to the population is as a result of buildings collapsing, and the denser the construction, the greater the risk. The magnitude of the damage would obviously be based on the magnitude of the earthquake.

What is the difference between TAMA 38/1 and TAMA 38/2?

In the TAMA 38/1 plan an addition is made to an existing building (up to 2.5 floors). With a project of this nature, the area of the existing apartment is always increased, a safe room is added and usually a balcony as well. The construction time will take anywhere between 12 - 18 months, and the residents will receive a bank guarantee, guarantee of repair for any problems resulting from the construction, and guarantee of registration in the Land Registry.
In the TAMA 38/2 plan the residents vacate the building, the building is demolished and a new one is built in its place. In this kind of project the area of the apartment does not always increase (this is dependent on the building permit).The construction time can be anything between 24 – 30 months and bank guarantee is given pursuant to the Seller’s Act, a guarantee for examination of the quality of the building and repairs that may be necessary after delivery of the apartments, tax guarantees in respect of betterment tax, and guarantee to ensure payment of the rental fee during the evacuation & reconstruction period.

What does one receive within the scope of the TAMA 38 plan?

As part of the TAMA 38 plan the apartments of the residents are upgraded, and they are entitled to receive:
˗ The addition of about 25 m2 gross to each apartment (of which, a minimum of 12 m2 to serve as a safe room);
˗ The addition of an elevator (even if this should deviate from the footprint of the building);
˗ Parking solutions for the owners of the new apartments, as well as for the owners of the existing apartments in the building;
˗ Protected spaces – the addition of a safe room in each apartment, and the addition of a protected area on each floor.

What are the risks of TAMA 38?

Before engaging in the TAMA 38 plan it is important to ascertain the following:
Who is the developer? How many years’ experience does he have in development and construction? Is it possible to see a project that has already been completed by him, and delivered to the residents, in order to examine the quality of the work? Is there a bank that is supporting the project? What guarantees do the building residents receive from the developer regarding the completion of work? What happens if the developer does not complete the project within the specified time?

What are the stages of implementing TAMA 38?
1. The construction engineer conducts a feasibility study and verifies that the building is included within the scope of the TAMA 38 plan.
2. Selecting a building committee representative and a lawyer who will represent the residents in negotiations with the developer.
3. Defining the individual requirements of the apartment owners and the consideration that will result from the process.
4. Application to the developer who will be carrying out the project. His responsibilities will include planning the project, making the application to the authorities, obtaining the necessary permits and the actual construction. The proper selection of a developer is critical to the process and it is important to select a developer who is experienced in such projects and has the necessary financial resources.
5. The actual construction process begins only after the developer has received the building permit from the local committee.

How can one ascertain whether a building is suitable for the TAMA 38 plan?

The TAMA 38 plan is carried out in buildings of over 2 floors which has been given a building permit, or was built prior to 1980, and the construction engineer has determined that the building needs to be reinforced. There are also updates to the law regarding buildings that were constructed subsequent to 1980.

How are the rights of the residents protected during the process of TAMA 38?

In order to protect the rights of the residents it is important to be familiar with the legislation and regulations relating to the subject of TAMA 38. In addition, it is advisable and common to hire the services of a lawyer who specializes in the field of TAMA 38 projects, to accompany the process and protect the rights of the residents in the event that legal issues arise. Within the scope of his duties he will ensure that the residents receive the maximum value from the project (upgrading the stairwell, the lobby of the building, the installation of a new elevator); that the residents will receive proper collateral; that the time allocated for the work is reasonable and feasible; and that the works will be conducted at times that do not interfere with daily routine.

What is the necessary majority required to implement TAMA 38?

To avoid a situation in which one objecting tenant can prevent the rest of the building from entering into the project and upgrading their home, the law has been updated and the required majority has drastically decreased. In 2005 it was necessary to have the agreement of all of the building’s residents to implement TAMA 38. In 2007 the first amendment to the law was made as a result of problems in the implementation of the plan, and it was defined that a majority of 66% of the residents of the building was necessary. In 2010 an amendment was made regarding the demolition and reconstruction of the building, and in such an instance the majority required is 80% of the building’s residents.
Despite the legislation, the amendments and the updates, there are still sometimes conflicts and disagreements between the tenants. These conflicts are settled in court, where most of those objecting to the implementation do not have well-grounded arguments to prevent carrying out the TAMA 38 plan, and for that reason most of these trials end up in support of the majority.

Who are the ‘signature contractors’ in the urban renewal project?

‘Signature contractors’ in urban renewal projects are contractors who have the tenants sign their agreement to conducting the project and after the majority of signatures have been obtained these are then traded versus the developers. This is why apartment owners may find themselves involved in an urban renewal project with an entirely different contractor than who they had signed with at the outset. Despite the wide range of companies who have experience in the field of urban renewal, ‘signature contractors’ are a widespread phenomenon. For this reason before becoming involved with a developer who specializes in urban renewal projects, you should check the authenticity of the information they have provided.

Does one receive tax relief as a result of implementing TAMA 38 / “Pinui/Binui’ (evacuation & reconstruction)?

In order to promote urban renewal projects and to interest the public in promoting a project of this type in their building, the state grants tax relief. These reliefs include full exemption from betterment tax, VAT exemption for construction and reinforcement of existing buildings, and relief on the improvement levy.

What costs are borne by the residents?

The residents of the building do not bear any of the costs deriving from the implementation of the TAMA 38 plan.
All of the payments and expenses for the professionals involved in the project are the responsibility of the developer with whom the project has been signed. When the contract is signed with the apartment owners the developer or the contractor is given an additional percentage of the building, which provides him with the ability to finance the work and all of the payments required to execute the project.

Is it possible to cancel a contract for urban renewal – TAMA 38 or Pinui/Binui?

A contract can be cancelled subject to the laws of the State and in accordance with certain conditions. The valid law in the field of urban renewal is the Contracts Law. Cancellation of a contract may be permitted in the event that it can be legally proven that substantial damage was caused during the signing of the contract / the developer or the contractor concealed significant information from the apartment owners / the developer does not fulfill the schedules that they committed to in respect of obtaining building permits.
According to Chapter B of the Contracts Law, a contract can be cancelled as a result of a defect in its signature, non-compliance with the agreed-upon timetables, changes in the construction plans without prior approval, and concealing significant information.
For these reasons, from the outset of the procedure, it is highly advisable to make use of the services of a lawyer to negotiate the terms and protect the rights of the residents vis-a-vis the developer or the contractor.

How long does the ‘Pinui/Binui’ (evacuation & reconstruction) project take?

A ‘Pinui/Binui’ process consists of six stages:
1. Recommendation of the city engineer (approximately 6 months) – The developer is in contact with the municipality in order to get all of the requisite recommendations, such as: aerial photographs, opinions of traffic consultants, measurement plans and opinions from assessors.
2. Declaring the complex as being suitable for the evacuation & reconstruction process (about 12 months from the date of signing the contract) – in order to receive tax exemptions and reliefs the government needs to declare that the site is an ‘evacuation & reconstruction site.
3. Obtaining approval for the “City Building Plan” (approximately 24 months from the date of signing the contract) obtaining TABA – the “City Building Plan" – from the regional committee.
4. Obtaining permits (about 12 months from the date of approval of the TABA) – obtaining the building permit from the municipality and other entities involved in the planning such as: the Fire Brigade, Civil Defense, and Transportation.
5. Implementing ‘Pinui/Binui’ (up to 24 months from the beginning of the work) – the tenants in a building slated for evacuation are relocated in temporary apartments until the end of the project implementation.
6. Moving into an upgraded apartment (about 6 years from the signing of the contract) – at the end of the work process the tenants move into a new and upgraded building.
The duration of the procedure and the progression at every stage of the project depends on the support of the residents. Lack of support and lack of cooperation can result in a considerable delay in completing the project.

What is the degree of success in the ‘Pinui/Binui’ projects?

The success of an ‘evacuation & reconstruction’ project depends to a considerable degree on the residents. Successful projects are those in which the residents are united, create a representative body with a team of professional advisors, and take an active part in the process, as full partners, at every stage. Because the ‘Pinui/Binui’ project renews all of the infrastructure and takes the requirements of the community into account, there is an upward trend in the number of urban renewal projects being undertaken, and this is expected to continue to rise during the coming years.

In the ‘Pinui/Binui’ project the number of residents in the same area increases significantly. What changes need to be made in transportation and traffic as a result of this?

Within the scope of the project the developer undertakes to completely upgrade the infrastructure, including new roads which must be adapted – in accordance with the standard – for the amount of vehicles that are forecast to be using the area. All of the traffic arteries in the surrounding area will be adapted and adjusted accordingly and this is expected to increase the flow of vehicles and decrease traffic congestion.

In the ‘Pinui/Binui’ project the size of the apartments may vary. What arrangements can be made for older tenants who no longer need a large apartment?

Residents who do not wish to enlarge the area of their apartment will have the opportunity of dividing it and benefiting from a new apartment which will be the right size for their requirements. Any requests of this nature will be thoroughly examined and we will do everything possible to address your requirements. In addition, ‘golden age’ residents will be given the option of certain changes to the apartment which will make it a safer and more pleasant environment for them.

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