The Surprise Awaiting Developers from Tel Aviv Municipality

While developers in Tel Aviv continue to deal with the long list of requirements on their way to obtaining the coveted completion certificate for their construction projects, it turns out that another challenge now awaits them – a particularly surprising financial charge. This time, it specifically affects those who chose to operate “by the book.”

Don’t Want Project Delays? You’ll Have to Pay

In many cases, as part of the conditions for completing a project and receiving a completion certificate for the construction, developers are required to register parcellation and land expropriation. This process involves approving a Registration Plan (TATZAR), collecting signatures, and dealing with significant bureaucracy – a process that can last for many months and delay the completion of the project and the developer’s obligations under agreements signed with landowners.

To avoid these delays, many developers choose to address the parcellation early, even before construction work is finished. However, this is where the Tel Aviv Municipality enters the picture – with a requirement that could make their initiative particularly expensive.

The Plot – No Longer Yours

The Tel Aviv Municipality has begun demanding payment for the use of areas designated for expropriation if that area is still being used by the developer for construction work, organization, or equipment storage. From the moment the parcellation documents are approved, the municipality considers it public property, and every day the developer remains on it… costs them money.

This involves payment calculated per square meter per month until the area is actually vacated. This is a new requirement that surprises many developers who acted in good faith to meet deadlines.

So what to do?

Usually, the expropriation land is cleared towards receiving Form 4, and then no payment will be required. There should be enough time from clearing the land until completing the requirements for receiving the completion certificate to register the parcel.

The recommendation is to act cautiously regarding the timing of the TAZAR approval and carefully examine the schedules and financial implications before finalizing the registration process.

Attorney Sofia Sheinker from our firm’s real estate department represented the entrepreneur in the parcel registration process.