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Earthquake: "There will be a terrible disaster here. This is a true alarm" - Walla! Of money

2022-01-24T09:09:37.831Z


The chairman of the Contractors Association explains why he thinks it is unfair to blame the contractors who do not promote the strengthening of buildings in the periphery and why the state is playing a double game when it comes to the price of real estate


Earthquake: "There will be a terrible disaster here. This is a true alarm"

The chairman of the Contractors Association explains why he sent an urgent appeal to the interior minister after the earthquakes, why he thinks it is unfair to blame the contractors who do not promote the strengthening of buildings in the periphery, why the state plays a double game when it comes to real estate prices. In a residential building

Liat Ron

24/01/2022

Monday, 24 January 2022, 10:38 Updated: 10:59

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Immediately after the second earthquake in the north, Raoul Srugo, president of the Builders of the Land Contractors Association, left a message to Interior Minister Ayelet Shaked and wrote, "The TMA 38 plan must be extended.



" Dilapidated throughout the Syrian-African region, Srugo, as the contractors' representative, also has a clear economic interest in extending the national outline plan to strengthen existing structures against earthquakes (due to pass from the world next October)



Needless to say, For a building permit, which puts a lot of money in their pocket.



The problem is that contractors do not want to strengthen buildings in the north, because the beautiful profits can be maximized in areas of demand, especially in Gush Dan, and put in not bad sums between Hadera and Gedera.

"Land prices in the north are neither worthwhile for NAP 38 nor for evacuation of construction," he explains the reluctance of developers to approach the projects that are there



.

There is a committee set up by the state and it states that the question is not whether there will be an earthquake but when.

In the past this has happened every hundred years and our century has already passed.



"We need to distinguish between public buildings and private buildings. The second earthquake was at noon, when all public buildings, kindergartens, schools and clinics, were crowded. From Kiryat Shmona to Eilat there are old cities in Israel built in the 60s-70s and if there is a strong earthquake here, There will be a terrible disaster here. This is a real alarm. In 2016 the state allocated NIS 5 billion to strengthen buildings, the money is painted, but has not been transferred to execution to date. The state announces and does not act, it is terrible.



" So that every year NIS 5-10 billion will be invested in strengthening buildings throughout the country. According to experts under the Dead Sea a huge penny of energy can lead to an earthquake of 7 on the Richter scale, meaning gates in the center of the country will be destroyed. "It is not enough to strengthen not only the public buildings around the Syrian-African rift, but also the schools on pillars in the center of the country."



What you are saying, in fact, is that the privatization of the strengthening of the structures made by the state through NAP 38 was a mistake and should be repealed because it failed.



"I'm not saying that. The government needs to strengthen the public buildings and the strengthening of the buildings will remain in the hands of the contractors. You should know that the world admires our NAP 38, which gives surplus rights to the contractor without the government intervening



. , Strengthen buildings even in the not-so-profitable north.



"If the state gives us more rights in projects in the center, then it will definitely pay off for us."



Do you mean more rights in addition to what you receive under the NPA? Even so, you are sweeping a lot of money in these projects.



"This is a demagogic statement. And why? The contractors made a good profit this year, because they made a profit on the stock of land they had, and it has nothing to do with TMA 38 projects. The contractors are not one miksa.

But in our case, getting more rights in Tel Aviv, Rishon LeZion and Raanana is nice, but the mayors will not agree to it. "



So you want the state to pay you.



" Here, now we come to the truly creative solutions.

There is a problem of low land value in the periphery and an incentive should be given to the developer, and yes, one of the solutions is that the state will pay the difference that transfers you to economic viability and this will be determined by a professional appraiser.

Another option, which is not rising yet, is complementary land.

If I build in Tiberias - I will receive additional land free of charge and on it I can build a hotel, offices or residential buildings. "

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The rescue forces are examining the damage after the earthquake in Tiberias.

Chronicle of a Predicted Disaster (Photo: Official Website, Photo - Tiberias Spokeswoman)

The double standard of RMI

Why does she not rise?



"Because Remi does not cooperate.

"Just as RMI opposes the allocation of land for long-term lease. They are not interested in giving such a definition because it will lower the value of the land."



And here we enter the double standard of the state.

On the one hand, it wants to lower housing prices, and on the other hand it is not willing to give up the high taxes that the real estate

sector

introduces into the state coffers .



The public has NIS 50 billion a year, which helped the state reduce the deficit. Why would it give it up? "

NAP 38 is about to end, but the "almond alternative" is stuck.

The solution: a tax credit?

"The third solution that can be considered is thinking outside the box: tax credit. The contractors will build in Ramat Gan, Tel Aviv and Rishon LeZion and if they also build a project in Tiberias, they will pay less income tax, just as they get credit points for single families and children. Construction in the periphery will bring more tax to the state than the credit it will give to the contractors, because the credit they will receive only after Form 4, that the building will already stand and be inhabited. It is an incentive for an entrepreneur not to cost a shekel to the state coffers. "



An incentive that will ensure that the contractors continue to get rich, and along the way the residents of the periphery will also benefit from the strengthening of buildings.



" I oppose the term 'get rich'. No one works for someone's beautiful eyes. The contractors want to make a profit. "



That it is perfectly legitimate, but in proportion. Housing prices have become inflated and unfounded by any order of magnitude

.



"I admit that in the immediate term, when prices go up, contractors earn more. But in the end it's bad, because the high profit is not enough to atone for the land costs they have to buy for the next project. The state is to blame for rising land prices because it has not marketed enough land. "Dov, for example, has land for ten thousand housing units. Why did the state issue a tender for only 1,500 units?"



To raise the price.



"And this is an example of schizophrenia in which the country lives. The project ended with four and a half billion shekels for 1,500 apartments. It's crazy. A lot of land needs to be marketed, because the rules of supply and demand work here as well."

Israeli NIMBY: Israelis are good at empathy, but are not willing to live near a shelter for battered women (Photo: Reuven Castro)

Real estate bubble? "Prices will never crash"

There are those who predict that because of the excessive rise in prices there will be a crash.



"Prices will never crash. It can never happen. There are several players in the market: the government, the contractors and the buyers. If the government lowers the demand, like imposing a purchase tax on investors, it causes them not to rent or sell apartments and that's how prices go up. The government. They will build less, the supply will be reduced and the price will go up. The government must work to increase the supply of apartments.



"Elkin, Shaked and Lieberman worked together and presented a plan whose purpose is to increase supply, which includes permits for foreign workers, self-licensing and bureaucratic procedures. The test will be performed. Remi needs to sell more land. And yes, we need to count the sales themselves, the housing units and not the marketing and brochures it distributes, let's not work on ourselves. About 75,000 units per year,Only then will we see a halt in price increases. "



Is it even possible to reach these numbers?



"It depends on the government's ability to carry it out. The main barrier is the local authorities, who are not in a hurry to give permits, due to infrastructure problems, or unattractive property taxes. They should be compensated by adding schools and kindergartens. State real estate in 2021 for the benefit of local authorities, it was working. We have an ongoing relationship with Haim Bibbs, chairman of the Local Government Center, and I hope they will help local authorities support infrastructure. "



"The Almond Alternative" mentioned by Srugo is the plan of the Minister of the Interior, Ayelet Shaked, who presented a plan that is supposed to replace the historic NPA, entitled: "The national plan to strengthen buildings against earthquakes", which she is promoting with all her might, but not immediately .



"The Shaked alternative is making a planning upgrade to NAP 38," explains Srugo. Two and a half other floors



. The nearby periphery, between Gedera and Hadera, is economically viable for demolition and construction. For battered women. "



Why can't a battered women's home be in a residential building?



"Because people will not buy apartments in buildings that have a shelter for battered women or 'El Sam', which is a bit problematic. They can be in brown, public areas. If there is a kindergarten on one floor, you can build another five floors and place them there, make better use of it. The territory. "



Almond alternative does not progress anywhere.



"Ask the Knesset why.

The Shaked alternative passed first reading and is now on the Knesset committee, and the chairman does not put it to the vote.

At the end of February, the winter session will end, so it will be postponed to at least April and

NAP 38 ends next October. Because developers know it ends, for a year now there are no new projects because they take time,

To date TMA 38 immediately, and she said, that if the alternative is not approved by the end of February, she will date her. The earthquakes have only strengthened this request and the contractors are waiting for her mouth to come out. "

Raul Srugo, chairman of the Builders of the Land Contractors Association. The State of Israel earned about NIS 50 billion in real estate last year, so why lower prices? (Photo: Kfir Sivan)

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Tags

  • Earthquake

  • Syrian-African rift

  • periphery

  • Tama 38

  • Contractors

  • Ayelet Shaked

Source: walla

All business articles on 2022-01-24

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