“What will we get?” is the heart of every pinui-binui negotiation. The answer depends on the plan, the building rights, the project’s economics and the owners’ bargaining power. There is no “standard” consideration fixed by law, so it is important to know what is usually negotiated and what must appear in the agreement.
The new apartment: how much space is added?
Owners usually receive a larger new apartment. The addition is generally measured in square metres relative to the current apartment and varies greatly between projects and cities. The agreement should define how the area is measured, whether the safe room and balcony are included, and what happens if the final area is smaller than promised.
What else is included?
- A safe room (mamad), mandatory in new construction.
- A balcony of a size defined in the agreement.
- Parking and storage: how many spaces, whether attached, and where.
- Technical specification: finishes, kitchen, flooring, windows, air conditioning, attached as a binding appendix.
- Management fees: the developer sometimes contributes for a period towards the new building’s fees, which may be higher.
How is the apartment’s location in the new building decided?
This often causes disputes. Equitable principles are usually agreed, such as keeping orientation and relative floor, or an orderly lottery. The principle should be set in the agreement in advance.
And during construction?
The developer pays rent and covers moving costs. See rent during construction. The consideration must also be secured, see guarantees in pinui-binui.
Can you receive money instead of an apartment?
In some cases a cash payment or other alternatives can be agreed, especially for elderly owners. See pinui-binui for elderly owners.
Next steps
Every pinui-binui project is different: the building, the developer, the plan and the owners themselves. At Paz Israel & Co. we represent apartment owners in urban renewal projects, review the offer and the agreement and support the owners’ committee throughout. See our pinui-binui and urban renewal page, or contact us to arrange a meeting in Tel Aviv, Jerusalem or Modi’in.
This article provides general information about Israeli law as of the time of writing and is not legal advice.