Jerusalem Residents Sue Ten Holdouts in Katamon Urban Renewal Project
Jerusalem residents filed a lawsuit demanding ten holdouts in an urban renewal project be declared unreasonable, citing massive cumulative damages over stalled redevelopment plans.
Residents of an urban renewal project in Jerusalem have filed a lawsuit in the Jerusalem District Court, demanding that ten dissenting neighbors be officially declared unreasonable holdouts, or alternatively, that financial compensation be ordered. The disputed complex is located on San Martin and Bar Yochai streets in the Katamon neighborhood, currently comprising five aging buildings with 3-4 floors and a total of 119 apartments.
Project Details and Scope
Out of all property owners, 109 residents—representing 91% of the project—have already given their consent, leaving ten holdouts. The partnership between the residents and the developing companies, Ken HaTor and Shikun & Binui, began in 2020 and extended through March 2022. The complex endeavor is slated to include two high-rise towers comprising 491 apartments, alongside public areas and parking facilities.
Existing apartment owners are set to receive significant upgrades, including elevators, parking spaces, an additional 25 square meters per apartment (including a secure reinforced room, or MAMAD), a 10-square-meter balcony, and a storage unit. While the statutory majority required for a Pinui Binui (evacuation and reconstruction) project is 66%, and dissenting owners are not uncommon, this case involves an unusually high number of holdouts in a single project.
"The defendants' refusal stems not from legitimate interests, but from demands for excessive compensation and personal improvements that are unjustified and unavailable to other apartment owners," the plaintiffs stated.
Legal Proceedings and Compensation Claims
Filing a lawsuit is a standard legal procedure in cases involving holdouts. The court will ultimately be required to determine whether the refusal is reasonable or unreasonable. If the court rules the refusal unreasonable, it may either compel the implementation of the project by appointing an authorized signatory or hold the holdouts financially liable for damages caused to the other property owners.
According to the plaintiffs, an appraiser on their behalf estimated the damage at 800,000 NIS per apartment, bringing the cumulative damage to approximately 80 million NIS. Due to court fee limitations, the lawsuit was filed for a lower amount of 10 million NIS, meaning each holdout could still face claims of 1 million NIS if compensation is awarded. The plaintiffs are represented by attorneys Ziv Groman and Lilach Zilkha from the Groman & Co. law firm, specializing in real estate and urban renewal.
