Pinui-binui in Israel: owner's rights before signing
Your building in Israel is targeted by a pinui-binui (ืคืื ืื ืืื ืื) project : a developer proposes to demolish it and hand you, a few years later, a new apartment in a modern tower. The offer is appealing, but it commits your property for a long time and follows a precise legal framework. Here is what an owner, especially one living in France, needs to know before signing.
I. What is a pinui-binui project?
Pinui-binui, literally "evacuation-reconstruction", is the most ambitious form of Israeli urban renewal, the hithadshut ironit (ืืชืืืฉืืช ืขืืจืื ืืช). Unlike Tama 38 (ืชื"ื 38), which reinforces and adds floors to an existing building, it involves demolishing a group of old buildings, often from the 1950s to 1970s, to build in their place a new, denser and taller complex.
The developer finances the operation through the additional apartments it will sell; each owner gives up their old apartment and receives a new dwelling, generally larger, with parking, elevator and a secured room ("mamad"). The scheme is governed by a specific law and supervised by the Rashut Lehithadshut Ironit (ืืจืฉืืช ืืืืฉืืชืืช ืืืชืืืฉืืช ืขืืจืื ืืช), the government authority for urban renewal.
II. What the owner receives in exchange for their apartment
This is not a classic sale: the owner exchanges their property for a future property. A well-negotiated contract therefore provides for:
a new apartment whose surface area, floor, orientation and specifications are defined from the moment of signing;
the developer covering rehousing rent for the entire duration of the works, as well as moving costs;
a bank guarantee within the meaning of the Sale of Apartments Law (ืืืง ืืืืจ ืืืจืืช), which protects the value of the promised apartment in case of developer default;
the developer covering the fees of the lawyer representing the owners vis-ร -vis the developer;
a favorable tax regime: within the limits set by law, the exchange is exempt from Mas Shevah (ืืก ืฉืื) and Mas Rechisha (ืืก ืจืืืฉื), and the betterment levy Heitel Hashbacha (ืืืื ืืฉืืื) is borne by the developer. Beyond these thresholds, for example if the owner obtains a cash consideration or a significantly larger surface area, taxation may reappear.
Elderly owners also benefit from special protections: the developer must offer them suitable solutions, such as compensation to relocate elsewhere or to a retirement residence.
III. The qualified majority and the "reluctant" owner
A pinui-binui project does not require unanimity: a qualified majority of owners can bring the others along. This threshold, long set at 80% of apartments, has been lowered by the legislator and now stands, under certain conditions, at around two-thirds of owners, with a parallel requirement regarding common areas; the exact terms should be checked project by project.
Once this majority is reached, an owner who refuses to sign, the dayar sarvan (ืืืืจ ืกืจืื), exposes themselves to legal action from their neighbors. The court checks whether the refusal is "reasonable": a non-viable project, lack of suitable rehousing, or insufficient guarantees are legitimate grounds. A refusal aimed solely at obtaining more than the others, however, can be deemed abusive; the reluctant owner then risks being ordered to compensate their neighbors, or even having a representative appointed to sign on their behalf. It is therefore better to negotiate early, alongside the majority, than to face a late court decision.
IV. Points of vigilance for an owner residing in France
Many of the apartments concerned belong to French-speaking owners living in France, who rent them out or occupy them a few weeks a year. Their situation calls for particular attention.
Do not confuse a letter of commitment with a contract
Developers often have owners sign a preliminary document first, the ktav hitkhayvut (ืืชื ืืชืืืืืืช), which reserves the project for them. Presented as harmless, it can bind the owner for a long period and should never be signed without careful reading.
Power of attorney and remote signing
The final contract is signed in Israel, before the owners' lawyer. An owner residing in France can sign by power of attorney (ืืืคืื ืืื), provided it is precise, entrusted to a trusted representative, and drawn up in a form recognized in Israel: before an Israeli notary, before the Israeli consulate in France, or before a French notary with an apostille and translation. A power of attorney that is too general or improperly legalized can delay the entire project and weaken the owner's position.
Checking the property's status at the Land Registry (Tabu)
Before any signing, the land registry extract, the Tabu (ืืืื) , must be checked: is the property registered in the owner's name, or still in that of a deceased relative whose estate was never settled? Is there a mortgage, a seizure, or an old he'arat azhara (ืืขืจืช ืืืืจื) ? Settling an estate can take several months; it is better to start before the project requires it.
Rental income
The landlord owner must anticipate the end of the lease at the time of evacuation and negotiate compensation for the loss of rental income; the tax consequences of the operation in France deserve examination with a competent French tax advisor.
V. The main stages of a project
formation of an owners' committee, the netsigut (ื ืฆืืืืช), and choice of a lawyer representing all the owners;
consultation of several developers and comparison of their offers;
negotiation then signing of the contract by the required majority;
approval of the urban planning scheme and obtaining the building permit, often the longest phase;
evacuation, demolition, construction;
delivery of the new apartments and registration of the new rights at the Tabu.
Between the first signature and the handover of the keys, one must count several years: the contract must include deadline provisions and penalties for the developer, otherwise the owner may remain indefinitely bound to a project that is not progressing.
Conclusion โ Why be assisted by a lawyer in pinui-binui?
Pinui-binui can transform an old apartment into a new dwelling of significantly higher value, without spending a single shekel. But the owner commits for years on the basis of a contract drafted by seasoned professionals. A lawyer checks the guarantees, deadlines, taxation and the validity of powers of attorney, and, if familiar with the reality of owners living in France, adapts remote signing, the regularization of titles at the Tabu, and the protection of rental income to their situation.
