Tel Aviv Municipality (Photo by David Shai, CC BY-SA 3.0 Wikimedia license)
Not every day the court rules compensation in a huge amount to be paid by the Tel Aviv Municipality, certainly not regarding land clearance, but this time it is a unique case, when the municipality is expected to issue a tender for the sale of land on Hayarkon Street, with building rights for a hotel and residential project. The said tender will be published after the court receives an eviction lawsuit filed by the municipality against two tenants, to whom it will pay compensation of NIS 46 million for the eviction.
This is a 3-dunam plot on 5 A Hayarkon Street, opposite the Dolphinarium and adjacent to the plot purchased by Doron Aviv and Lenny Group in 2019 for NIS 250 million. As with quite a few lands in the area, land ownership was unregulated, and in the 1980s the municipality filed an eviction lawsuit against the landowners. They, on the other hand, filed a land ownership claim.
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According to the municipality, the reason for the eviction of the tenants was born with a change in the designation of the land and the approval of a plan for the Carmelit complex, which took effect in 2015, when construction of residences and hotels in the complex was approved. As stated, the municipality claims that the tenants can be evicted due to a change in the designation of the land and in accordance with the tenant protection laws.
It is important to note that the law stipulates that when the local authority has a ground for eviction, it must provide the tenant with an alternative arrangement, but the municipality argued that an alternative arrangement could be expressed in monetary compensation. Therefore, in 2018, the municipality sent a letter to the tenants, in which it offered them compensation in the amount of NIS 9.9 million for the evacuation of the land. The tenants did not vacate the land and the municipality filed a lawsuit against them.
The ruling stipulated that the amount of compensation would be paid for the original house, which was built when the settlement agreement was signed between the parties. The house includes a built-up 230-square-meter building, and the arrangement will not include additional buildings that were erected later. The municipality set the amount of compensation at NIS 9.9 million in the calculation of the key fee.
On the other hand, the appraiser Arieh Kamil on behalf of the first defendant estimated that the value of a square meter in the beach area is NIS 65,000 per square meter. Accordingly, the amount of compensation that reflects the value of the home and land is no less than NIS 100 million. Camil estimated the compensation at the weight of the key fee issue at NIS 80 million.
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Tel Aviv Magistrate’s Vice President Amit Yariv ruled that the difference between the amount of compensation determined in each case did not stem from the price difference per square meter in which the appraisers were determined, but from the inclusion of land beyond the residence. The judge noted that the settlement For compensation only for the house and the yards in an area of 657 square meters, while treating the tenants as protected tenants who paid key fees, and not as having the right to lease or ownership.
For this purpose, Yariv adopted the opinion setting a price tag of NIS 65,000 per square meter along the shoreline, and determined that the value of the residence is NIS 57 million. Accordingly, the amount of compensation was set at NIS 46 million..
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