Appeals committee: betterment levy in the Nordau Max project expected to fall by tens of millions of shekels

The Central District Appeals Committee for Compensation and Betterment Levies discussed an assessment by an arbitrating appraiser on the “Nordau Max” project in Kiryat Nordau, in a dispute between the developer, the Damri company, and the local planning and building committee in Netanya.

In the project, near Route 2, seven old railway-style apartment blocks (binyanei rakevet) with 138 apartments will be demolished, and in their place three residential towers with commercial space will be built, with a total of 553 apartments. The plan came into effect in September 2022.

The economic feasibility study carried out for the plan estimated the betterment levy (heitel hashbacha, a payment to the local authority on the rise in land value due to a plan) at about NIS 9 million. By contrast, the municipality's original assessment demanded about NIS 93 million. During the appeal, the municipality reduced its demand to about NIS 41.6 million, and the developer argued that the plan creates no betterment at all. The arbitrating appraiser estimated the betterment at about NIS 20.9 million, meaning a levy of about NIS 10.45 million.

One of the central questions was whether a levy should be charged on building rights intended for safe rooms (mamad). The committee adopted the alternative that exempts these rights. It determined that the feasibility study's estimate does not bind the authority, but when there is a large gap between it and the later assessment, a convincing professional explanation is required, and the municipality's explanation did not meet that standard.

The appraiser will carry out further checks, among them whether rights under Tama 38 (the national plan for strengthening buildings against earthquakes) can be realized. Both sides appealed the assessment, so the amount of the final levy has not yet been determined.