Jerusalem Homebuyers Sue Developer for Delayed Apartment Delivery Amid War Excuse
Fifty-six homebuyers, mostly young couples who won government-subsidized housing lotteries, filed a lawsuit this week against the developer "Bustan Arnona Initiatives" in Jerusalem's Arnona neighborhood. They seek approximately 4.2 million shekels in compensation for an average nine-month delay in apartment handover. The plaintiffs argue the developer breached contracts and legal obligations by failing to pay compensation for the delay period.
According to the lawsuit, 29 apartments were delivered about nine months late from the contractual deadline. Buyers had to pay rent and mortgages simultaneously while living with ongoing uncertainty. The developer has not paid any compensation to date. The company attributes delays to the recent Iron Swords war, labor shortages, and infrastructure setbacks. However, the buyers contend that the war does not constitute a force majeure that exempts the developer from compensation, citing a July 2025 Supreme Court ruling that requires concrete proof linking delays to specific war-related events.
The plaintiffs also argue that delays caused by the electric company and infrastructure contractors are risks borne by the seller and do not justify exemption. The developer promised delivery by the end of March 2024, but the first apartment was handed over only in December 2024 and the last in January 2025. Buyers claim significant damages including the need to find temporary rentals, pay overlapping housing costs, and arrange distant schooling for children.
The buyers estimate fair rental costs at 2.9 million shekels, with late payment interest raising the claim to 3.8 million shekels, plus additional damages and emotional distress totaling about 4.16 million shekels. The developer responded that its managers were drafted during the war, causing severe labor shortages, but it completed two buildings first in the neighborhood. It denies responsibility for infrastructure delays, says it kept buyers regularly informed, and considers the lawsuit baseless and the claimed amount excessive. The case will proceed in the Jerusalem District Court.
