War Damage Rehabilitation by means of Urban Renewal Law, 5786-2026
חוק שיקום נזקי מלחמה בדרך של התחדשות עירונית, תשפ"ו-2026
Published: 2026-04-05Consolidated Hebrew text as of 2026-08-13 · Last amended 2026-04-05✓ Amendment status checked against the Knesset legislation record on 2026-09-28
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Section B: Rehabilitation Transactions and Exit Agreements
Application of Provisions from the Evacuation-Construction Law to Rehabilitation Transactions in a Rehabilitation and Renewal Area§
35.
The provisions of sections 1a and 1b(a) and (b) of the Evacuation-Construction Law (Encouragement of Evacuation-Construction Projects), 5766-2006 shall apply, with the necessary modifications, in respect of a rehabilitation transaction, to the extent possible and in accordance with the circumstances following the occurrence of the war damage.
Prior Transactions§
36.
(a)Where an evacuation-construction transaction or a transaction under a strengthening plan has been entered into in respect of an apartment in a building in the rehabilitation and renewal area before the date of the declaration (in this Chapter – a prior transaction), and at that date the vacation of the existing apartment has not yet commenced, the following provisions shall apply:
(1)A prior transaction shall also be deemed, for the purposes of this Law, to be a rehabilitation transaction; however, nothing in the provisions of this Law shall derogate from the provisions of section 1d of the Evacuation-Construction Law (Encouragement of Evacuation-Construction Projects), 5766-2006 and from the provisions of section 5c of the Real Property Law (Earthquake Protection of Condominiums), 5768-2008;
(2)A developer or an apartment owner who entered into a prior transaction may, within 50 working days from the date of the declaration, cancel it by written notice for any reason whatsoever, without being deemed to have breached the engagement, provided that where the cancellation is made by an apartment owner – he has entered into an enlarged exit agreement with the same developer with whom he entered into the prior transaction.
(b)An apartment owner in a building in the rehabilitation and renewal area who entered into an organisation agreement with an organiser in respect of that apartment before the date of the declaration may, within 50 working days from that date, cancel it by written notice without being deemed to have breached the engagement with the organiser.
The Obligation to Offer a Rehabilitation Transaction or an Exit Agreement§
37.
A developer shall offer to every apartment owner or plot owner in the rehabilitation and renewal area who can be located with reasonable diligence a rehabilitation transaction, and to an apartment owner also an enlarged exit agreement.
Provisions in respect of an Enlarged Exit Agreement§
38.
(a)An exit agreement signed within 95 working days from the date of the declaration is an enlarged exit agreement, and the following provisions shall apply to it:
(1)The consideration for the acquisition of the rights in the real property shall be in the amount of the valuation determined under section 33(c);
(2)The agreement shall include a provision to the effect that if a rehabilitation developer who is not the developer who entered into the enlarged exit agreement is approved, the obligations and rights of that developer under the agreement shall be assigned to the rehabilitation developer.
(b)If the provisions referred to in subsection (a) have not been stipulated in an enlarged exit agreement, the agreement shall be deemed to include such provisions.
Reporting on a Rehabilitation Transaction and on an Enlarged Exit Agreement§
39.
(a)A developer who has entered into a rehabilitation transaction with an apartment owner or a plot owner, or who has entered into an enlarged exit agreement with an apartment owner, shall submit to the Director a copy of the transaction or agreement, as the case may be; if a copy of a transaction or agreement as aforesaid has not been submitted, that engagement shall not be taken into account in the calculation of the special majority of apartment owners under section 40.
(b)An apartment owner or a plot owner may submit to the Director a copy of the transaction or agreement, as the case may be; if a copy as aforesaid has been submitted, that engagement shall be taken into account in the calculation of the special majority of apartment owners under section 40, even if it was not submitted by the developer as referred to in subsection (a).
(c)A report as referred to in subsections (a) and (b) shall be submitted immediately after its signing, provided that 50 working days have elapsed from the date of the declaration and no later than 95 working days from the date of the declaration.
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Contact Us →Section C: Rehabilitation Developer
Approval of a Rehabilitation Developer§
40.
(a)Subject to the provisions of subsections (b), (c) and (e), the Director of the Urban Renewal Authority shall approve a developer, if the conditions referred to in paragraphs (1), (2) or (3) below are met in respect of him, as a rehabilitation developer in respect of a rehabilitation and renewal area, in the following order of priority:
(1)The developer has entered into a rehabilitation transaction or an enlarged exit agreement with a special majority of apartment owners and plot owners, provided that he has entered into a rehabilitation transaction with at least 20% of the apartment owners in the rehabilitation and renewal area;
(2)The developer has entered into a rehabilitation transaction with the highest number of apartment owners or plot owners in the rehabilitation and renewal area, provided that the apartment owners or plot owners who have entered into an engagement with him, together with the apartment owners who have entered into an enlarged exit agreement with him or with another developer, within 95 working days from the date of the declaration, constitute a special majority of apartment owners;
(3)The developer has entered into a rehabilitation transaction with the highest number of apartment owners or plot owners in the rehabilitation and renewal area, provided that all apartment owners or plot owners who have entered into an engagement with him or with another developer in a rehabilitation transaction or an enlarged exit agreement, within 95 working days from the date of the declaration, constitute a special majority of apartment owners; approval under this paragraph shall be conditional upon the fulfilment of the conditions under section 43(b).
(b)An application by a developer for approval as a rehabilitation developer under subsection (a) (in this section – an application for approval) shall be submitted during the period commencing 50 working days from the date of the declaration and ending 95 working days from the date of the declaration (in this Law – the submission period).
(c)The developer shall attach to the application for approval documents to prove the conditions referred to in subsection (a), and if two or more developers have jointly submitted the application for approval – also evidence of the existence of a joint transaction between them for the performance of the rehabilitation, as well as an affidavit in support of the facts set out in the application for approval; the Director of the Urban Renewal Authority may require the developer to provide him with additional information and documents required for the purpose of a decision on the application for approval.
(d)The Director of the Urban Renewal Authority shall examine an application for approval submitted under subsection (a)(1) within 15 working days from the day it was submitted and shall give a decision thereon at that time, and in respect of an application for approval submitted under subsection (a)(2) or (3) – upon the expiry of the submission period, and shall give a decision thereon within 15 working days from the expiry of the submission period.
(e)
(1)A condition for the approval of a rehabilitation developer shall be that he has undertaken to assume the rights and obligations under exit agreements signed with other developers in the same rehabilitation area;
(2)Notwithstanding the provisions of subsection (a) or (c), the Director of the Urban Renewal Authority shall not approve an application for approval of a developer who has notified that he is interested in receiving financing assistance under section 45, unless the developer has attached to the application for approval a confirmation from the Director of Property Tax that the following two conditions are met in respect of him (in this section – the Director of Property Tax's confirmation): he meets the conditions determined under section 45(a) and he has not been convicted of an offence which, by reason of its nature, severity or circumstances, renders him, in the opinion of the Director of Property Tax, unfit to receive the assistance, and no indictment has been filed against him for such an offence;
(3)Notwithstanding the provisions of paragraph (2), the Director of the Urban Renewal Authority may permit the developer to attach the Director of Property Tax's confirmation within ten working days from the expiry of the submission period;
(4)A developer who is interested in receiving financing assistance under section 45 if approved as a rehabilitation developer shall notify the Director of the Urban Renewal Authority thereof and shall apply to the Director of Property Tax, upon submitting the first report under section 39(a), for a Director of Property Tax's confirmation.
(f)If the Director has approved an application for approval, he shall send a notice thereof to the rehabilitation developer and to the local authority within whose boundaries the rehabilitation and renewal area is located, and shall also publish a notice thereof on the website of the Urban Renewal Authority.
Non-Approval of a Developer as a Rehabilitation Developer§
41.
If the Director has not approved an application for approval under section 40 upon the expiry of 110 working days from the date of the declaration, the declaration under this Law shall be deemed void and its provisions shall not apply.
Sale to a Continuing Developer§
42.
If a rehabilitation developer has sold all of his rights and obligations under rehabilitation transactions or under exit agreements in the rehabilitation and renewal area to a continuing developer, the Director of the Urban Renewal Authority shall approve the continuing developer, upon his application, as a rehabilitation developer in place of the selling developer, if he has found that the conditions prescribed in section 40(a)(1) or (2) and (e) are met in respect of the continuing developer; in this section, "continuing developer" – as defined in section 49y1 or 49af3 of the Real Property Taxation Law, as the case may be.
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Contact Us →Section D: Transactions and Agreements after Approval of a Rehabilitation Developer
Provisions in respect of Transactions and Agreements after Approval of a Rehabilitation Developer§
43.
(a)If a developer has been approved as a rehabilitation developer under section 40, the following provisions shall apply:
(1)Without derogating from the provisions of any law, an apartment owner or a plot owner may cancel a rehabilitation transaction or an organisation agreement without being deemed to have breached the engagement with the developer or the organiser, as the case may be, provided that the cancellation of the transaction or agreement is made for the purpose of entering into a rehabilitation transaction with a rehabilitation developer or, in the case of an apartment owner, for the purpose of entering into an exit agreement with a rehabilitation developer; if an apartment owner or a plot owner has cancelled a rehabilitation transaction or an organisation agreement under the provisions of this section, he shall deliver written notice thereof to the developer or the organiser, as the case may be;
(2)The rights and obligations under an enlarged exit agreement of a developer who is not the rehabilitation developer shall be assigned on the day of the grant of the approval to the rehabilitation developer in that area; the Director of the Urban Renewal Authority shall notify the rehabilitation developer of every enlarged exit agreement reported to him;
(3)The rehabilitation developer shall offer, within 30 working days from the date of his approval as a rehabilitation developer, to every apartment owner or plot owner in the rehabilitation and renewal area who has not entered into a rehabilitation transaction with him up to that date, to enter into an engagement with him in one of the following, as the case may be:
(a)to an apartment owner who has not entered into a rehabilitation transaction or an exit agreement with him or with another developer up to that date – to enter into a rehabilitation transaction or an exit agreement with him, the consideration for the acquisition of his rights in the real property being in the amount of the real property valuation conducted under section 33(b);
(b)to an apartment owner who entered into an engagement with another developer before the end of the submission period and this was reported under section 39 – to enter into a rehabilitation transaction or an exit agreement with him, the consideration for the acquisition of the rights in the real property being as referred to in section 38(a)(1);
(c)to a plot owner who has not entered into a rehabilitation transaction with him or with another developer up to that date – to enter into a rehabilitation transaction with him.
(b)Without derogating from the provisions of subsection (a), if a developer has been approved as a rehabilitation developer under section 40(a)(3), the following provisions shall apply:
(1)Upon the expiry of the period referred to in subsection (a)(3), the Director shall examine whether the conditions under section 40(a)(1) or (2) have been fulfilled in respect of the developer, and shall deliver a notice thereof to the rehabilitation developer and to the local authority within whose boundaries the rehabilitation and renewal area is located, and shall also publish a notice thereof on the website of that local authority;
(2)If the Director has found that the conditions as aforesaid have been fulfilled, the rehabilitation developer shall offer, within 30 working days from the date on which a notice under paragraph (1) was published, to every apartment owner or plot owner in the rehabilitation and renewal area who has not entered into a rehabilitation transaction or an exit agreement with him, the matters referred to in subsection (a)(3), as the case may be;
(3)If the Director has found that the conditions as aforesaid have not been fulfilled, the approval shall lapse and the declaration under this Law shall be deemed void.
Manner of Acquisition of the Rights of an Apartment Owner who Entered into an Exit Agreement§
44.
(a)A rehabilitation developer shall acquire the rights in real property of every apartment owner in the rehabilitation and renewal area with whom he has entered into an exit agreement, against payment of the purchase consideration as referred to in subsection (d), within 90 days from the following dates, all according to the later:
(1)Approval of a developer as a rehabilitation developer under section 40(a)(1) or (2);
(2)A determination by the Director of the Urban Renewal Authority that the conditions referred to in section 43(b)(1) have been fulfilled in respect of a rehabilitation developer approved under section 40(a)(3);
(3)Deposit of a rehabilitation and renewal plan in that area.
(b)Notwithstanding the provisions of subsection (a), if an apartment owner has requested to defer the acquisition of his rights in accordance with the exit agreement, the rehabilitation developer shall defer the acquisition of the rights as aforesaid, provided that the acquisition of the rights is carried out no later than the date of vacation required for the commencement of construction works.
(c)Notwithstanding the provisions of subsection (a), if it is not possible to complete the acquisition procedure within the period referred to in that subsection, the Director of Property Tax may extend that period, if he has found that this is required for reasons beyond the control of the developer or the apartment owner.
(d)The developer shall pay to every apartment owner with whom he has entered into an exit agreement, as consideration for the acquisition of his rights in the real property, the purchase sum determined under section 38(a)(1) or 43(a)(3), as the case may be, and if an objection as referred to in section 34 or a petition against a decision on the objection has been submitted – the purchase sum determined in the decision on the objection or in the petition, as the case may be; the purchase sum to be paid by the developer shall be linked to the consumer price index published by the Central Bureau of Statistics, from the determining date for the purposes of the valuation until the date of actual payment.
(e)If the rehabilitation developer has not acquired the rights of all the apartment owners in the rehabilitation and renewal area with whom he has entered into an exit agreement, within the period referred to in subsection (a), the Director shall be entitled to cancel his approval as a rehabilitation developer.
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