Ramat Gan Apartment Owners Appeal Controversial Urban Renewal Ruling to Supreme Court

Apartment owners in Ramat Gan have filed an appeal to the Israeli Supreme Court against a district court ruling that challenges the current urban renewal compensation model. The ruling by Judge Gilad Hess of the Tel Aviv District Court found that granting an equal additional area to all apartments, regardless of their original size, violates equality principles and discriminates against owners of larger apartments. The court ordered a compensation payment of approximately 141,000 shekels to one of the apartment owners.

The case arose from a dispute in a renewal project at 75-79 HaRav Kook Street in Ramat Gan, where three buildings from the 1960s with 37 apartments are to be demolished and replaced by a 20-story tower with 95 apartments and commercial spaces. According to the agreement, all owners would receive a uniform 12 square meter addition plus a balcony, parking, and storage if possible. However, Keren Or Manpower Services, owning rights to 35 of the apartments, sued two owners who refused to consent, arguing the uniform addition was unfair, especially to the owner of a 104 square meter apartment who received only an 11% increase compared to 36% for a smaller 35 square meter apartment.

Judge Hess ruled that equal additions distort the relative size ratios between apartments and breach equality. The appeal, filed by attorneys Moshe Raz-Cohen and Oded Zaguri, argues the ruling contradicts planning law and policy, threatening to paralyze the urban renewal market. They maintain that uniform area additions are the accepted norm supported by regulators and appraisal standards, designed to incentivize collective renewal efforts rather than enrich owners of larger apartments.

The appeal stresses that building rights in renewal projects are governmental incentives to strengthen structures, not to increase owners’ wealth. It also defends community autonomy in economic model decisions, warning against individual owners blocking projects for personal gain. Raz-Cohen stated the district court erred, and the ruling could cause market disruption and stagnation. The appellants hope the Supreme Court will overturn the decision.