In urban transformation projects, the sole property owner is not signing the agreement

1. The Framework of Urban Transformation and the "Sole Property Owner Refusing to Sign" Problem

One of the most common problems in urban transformation projects one or more property owners refuse to sign the contract. This is especially true for:

When a construction contract in exchange for a share of the completed building is signed,
When there are owners who do not approve the contract despite a decision made by a 2/3 majority,
During the implementation phase following the decision on a building being at risk,

The question arises, "What are we going to do if the sole owner isn't signing?".

In this situation, three main options emerge for the majority of property owners:

Reaching a compromise with the minority property owner(s) and offering additional benefits,
Implementing the mandatory processes in urban transformation legislation (e.g., auctions under Law No. 6306, etc.),
The minority of property owners selling their shares, transferring them to a third party or contractor.

This article focuses on for minority shareholders to sell their shares on their own initiative, the legal consequences of such sales, and the risks encountered in practice.

2. Who is the Minority Owner? Their Relationship with the 2/3 Majority

2.1. The 2/3 Majority Rule and Minorities

One of the fundamental thresholds in urban transformation projects is that decisions regarding independent unit ownership must be made by at least a 2/3 majority based on the land share of the owners . When this ratio is achieved:

Signing of the construction contract in exchange for a share of the completed building
Choosing a contractor,
Determining the implementation project

Decisions can be made on issues such as these. The remaining one-third are technically considered a "minority".

2.2. Can a Sole Owner Be a Minority?

In many cases, the "sole owner" is actually in the minority. For example:

In a building with a total of 10 independent units, 9 owners have reached an agreement with the contractor
One property owner refuses to sign the contract, saying, "I don't want to leave the building" or "I don't like the terms.".

In this situation, if the total land share of the 9 owners exceeds 2/3, the single owner who has not signed is considered a minority owner . However, even if the majority has made a decision, this single owner can still significantly slow down the project when it comes to implementation.

3. Sale of Shares by Minority Owners: The Basic Legal Basis

3.1. Right of Ownership and Freedom to Sell Shares

According to the Turkish Civil Code, a person who owns a property jointly (in co-ownership) can, as a rule, sell, donate, or transfer their share to a third party. This is a natural consequence of the right of ownership. Therefore, if the minority owner says, "I don't want to participate in this project, I want to sell my share," there is no legal obstacle to this.

Here are the key points:

The sale officiallyat the land registry office.
The sale price and terms are freely determined between the parties.
With the transfer of ownership, the new owner replaces the previous owner in the urban transformation process.

3.2. Risk of Pre-emption Right

When shares are sold in co-ownership, the legal right of pre-emption (shufa) may arise. This means:

If the minority shareholder sells their stake to a third party,
The other partners may file a lawsuit within specified periods to request that these shares be transferred to them at the same price and under the same conditions.

This situation can be used strategically in urban transformation as both a threat and an opportunity . For example:

The majority may prefer to have a compliant investor acquire the share rather than a minority owner who is sabotaging the project.
The minority shareholder, however, might use the fact that "a pre-emption lawsuit can be filed anyway" to increase the value of their share.

4. Voluntary Sale of Shares: What Proceedings Should a Minority Shareholder Take?

If a minority property owner does not approve of the urban transformation project or no longer wishes to cooperate with their neighbors, voluntary sale of their shares (transferring their share of the property at their own will).

4.1. First, Consult with Other Owners

In practice, the most sensible approach is to first offer the property to the other owners. Because:

Other property owners may be willing to make additional payments to resolve this issue that is stalling the project.
When a building is demolished, ownership rights on the land are distributed more clearly, which can be attractive for landowners who want to accumulate their land shares.
It minimizes potential future disputes and reduces the risk of lawsuits between neighbors.

Making a written offer at this stage, and if possible sending a formal notice through a notary, will prevent future claims of "I never received such an offer.".

4.2. Sale of Shares to the Contractor

Another option for a minority shareholder to sell their share directly to the contractor. Specifically:

If the contractor absolutely wants to complete the project,
If the share of the sole owner who hasn't signed is critical to the integrity of the project,

The contractor may choose to purchase the minority owner's share by paying cash instead of an apartment . In this case:

Minority property owners will not become apartment owners in the future
However, he will have exited the project by paying in cash.

The critical point here is that the sale price close to the true market value and determined in a way that will not give rise to claims of "usury" (excessive profit) in the future.

4.3. Sale of Shares to Investors

In some cases, an agreement cannot be reached with either the contractor or the other property owners. This is where third-party investors step in. These investors want to acquire land in urban transformation zones:

By acquiring the shares of minority owners,
It aims to gain a stronger position in the urban transformation project.

However, here are some points to consider from the perspective of minority property owners:

Whether the person to whom the sale will be made actually has the ability to pay,
Whether it will make the project's progress even more difficult,
The question is whether this will lead to more serious conflicts with other property owners in the future.

5. Not Confusing Compulsory Share Sale with Voluntary Share Sale in Urban Transformation

Although the main topic of this article is voluntary share sales , there is a point that is frequently confused in practice: the mandatory share sale processes under Law No. 6306 .

In summary:

Shares of minority shareholders who do not agree with the decision taken by a 2/3 majority,
They can be put up for sale through specific procedures via the administration (e.g., auction).
This could mean that a minority shareholder's property could be put up for sale "against their will".

Conversely, a voluntary sale of shares can have the opposite effect:

a minority owner voluntarily .
The parties are free to determine the price.
There is no question of administrative or court coercion.

Therefore, when planning the share sale process for the minority shareholder, the risk and possibility of forced sale must also be taken into account; the question "If I don't sell today, is there a risk that it will be sold at a lower price by the administration in the future?" must be considered.

6. Majority Strategy if the Sole Owner Doesn't Sign: Buying the Minority Share

also consider this issue from another perspective, that is, from the point of view of the majority of property owners . What if the sole property owner does not sign and is in the minority?

The stake of the person who blocked the project may be relatively small (e.g., 5%, 10%).
Despite this, the construction permit cannot be obtained because the signature is not provided, the contractor cannot start the work, and processes such as rent assistance may be delayed.
The resulting loss of rent and decrease in value due to this delay could lead to significant losses for the majority of people.

Therefore, the majority of property owners may consider the following strategies:

Buying the minority shareholder's stake at a price close to its market value .
To consolidate this share among themselves under one owner or to transfer it to a joint investor,
This way, the legal obstacle to the project can be removed.

Here, of course, the majority shareholders the price they will payis reasonable compared to the damage that may result from delay. Sometimes, abandoning a share purchase because it "seems too high" can be a far cheaper solution than years of disputes.

7. Legal Points to Consider in Share Sale Agreements

While the transfer of minority shares in urban transformation projects may seem like a simple "sale in the land registry," the ongoing urban transformation process in the background . Therefore, it is highly beneficial to reflect the following points in the share sale agreement (official deed in the land registry and supplementary protocol):

7.1. Clearly Stating the Urban Transformation Status

the property a risky building area or an urban transformation zone ,
a previous 2/3 majority decision ,
If there is a contract signed with the contractor, its date and basic terms,

This must be clearly stated in the contract. This will prevent future disputes such as "I didn't know this property was included in an urban transformation project.".

7.2. To Whom the Subsequent Rights of the Apartment Will Belong

After the share sale:

To whom will the rights to the independent units (apartments, shops) that will arise within the scope of the new project undertaken with the contractor belong?
If the project has not yet been signed, all rights that may arise in the future are transferred to the buyer

This should be clearly stated in the contract. Otherwise, the following types of disputes may arise:

"I sold my share, but I was entitled to a new apartment, for example a 1+1 unit, in the new project; that right remains."

To eliminate these gray areas, commitments must be detailed and in writing.

7.3. Leasing, Use and Eviction Process

In some cases:

Minority owners transfer their shares
But he continues to actually use (live in) the independent unit,
Afterwards, serious arguments arose regarding the eviction.

Therefore, the contract states:

Whether the right to use the property will expire immediately upon sale or after a certain period of time,
Whether a rental relationship will be established,
Evacuation date and conditions

It must be written very clearly. If necessary, a lease agreement or eviction undertaking can be drawn up at the same time.

7.4. Tax Aspects and Title Deed Fees

Selling shares also has tax consequences. In particular:

Understating the actual sale price,
This could create problems in future tax audits due to the difference between the market value and the declared value

From the perspective of minority property owners as well:

If the property was acquired less than 5 years ago, income tax may be levied as a capital gains tax

Therefore, determining a realistic price and seeking advice from a financial advisor if necessary is important.

8. Frequently Asked Questions in Practice (FAQ Style)

8.1. If the sole owner doesn't sign, will the urban transformation project be completely finished if I sell my share?

No. Actually, the opposite is true: to transfer your share to a compatible party in order to move the project forward . For example, if you sell to a contractor or the majority owners, the project usually progresses faster. If you sell to a random investor, you may then have trouble reaching an agreement with the new owner.

8.2. If I sell my share, will my right to urban transformation rental assistance or a new apartment continue?

As a rule, no. When you sell your share, all rights associated with that share pass to the buyer. Unless otherwise agreed in the contract, rent assistance, cash support, or the right to an apartment in a new project also belong to the new owner.

8.3. As a minority shareholder, can I demand a very high price?

The price is negotiable; however, demanding an excessively high price is unacceptable

It makes it harder to find a buyer
This leads the majority of property owners to approach you with arguments such as "violation of neighborhood law, abuse of rights,"
This could create the risk of having to accept a much lower price in future mandatory sales processes under Law No. 6306

Setting a price that is reasonably close to market conditions is often the wiser approach.

8.4. Is it not possible to proceed with urban transformation without the minority property owners receiving their share?

In some cases, it may be possible to proceed through procedural channels (e.g., compulsory sales processes). However, this is a highly technical and time-consuming process. In practice, acquiring a minority stakeis often faster and less costly than dealing with litigation and administrative processes.

8.5. Is it mandatory to work with a lawyer when selling shares?

It's not mandatory; however, since urban transformation projects involve very high costs and rights that span many years, working with a lawyer is practically essential. Even the omission of a single word can lead to the loss of rights worth millions of liras.

9. Strategic Recommendations for the Minority Owners

If you are a minority shareholder considering selling your shares, it would be safer to proceed with these steps:

Analyze the current situation
- What is the urban transformation status of the building?
- Has a 2/3 majority been achieved?
- Is there a contract signed with the contractor?
Exhaust all channels of reconciliation
- First, negotiate reasonably with your neighbors.
- Put your proposals in writing.
Calculate Property Value and Share Value
- Obtain a report from an expert or real estate agent if necessary.
- Also consider the value that will emerge after urban transformation.
Select Buyer Profile
- The contractor, the other owner, the investor…
- Evaluate who you would have a smoother working relationship with.
Prepare a legally strong draft contract
- Make sure to include details such as the urban transformation status, future rights, eviction, and tax obligations in the contract.
Complete the title deed procedures meticulously
- Show the actual sale price as accurately as possible.
- Always read the official title deed carefully and ask questions about anything you don't understand before signing.

10. Recommendations from the Perspective of Majority Owners

If the sole owner isn't signing and the project is stalled, you, as the majority, should also have a strategic plan :

Establish a common position
- All other property owners must have a clear common position and offer policy.
- The process is complicated by different property owners making “secret agreements” with the minority.
Compromise and a Reasonable Offer
- Instead of a complete standoff, consider involving a minority in the project or buying their stake at a reasonable price.
Create a Legal Roadmap
- Will the mandatory processes under Law 6306 be implemented, or will the share acquisition take priority?
- Detail the time, cost, and risk analysis with a lawyer.
Create Contractual Guarantees
- If you are acquiring a share from a minority owner, clarify the sharing of future rights and interests from the outset.

11. Conclusion: Share Sales Could Be a Way Out in Urban Transformation

While the refusal of a single property owner to sign the necessary documents in urban transformation projects may seem like an insurmountable problem at first glance, the sale of shares by minority property owners could offer a practical solution for both the minority and majority owners.

Rather than being forcibly involved in a project they deem unsuitable, a minority shareholder can end the process for themselves by selling their share
If they own the majority of the property, they can remove the biggest obstacle to the project,
urban transformation more quickly and safely .

However, it is important to remember that
these types of sales ordinary apartment sales ; they are intertwined with all the technical, legal, and economic dimensions of urban transformation. Therefore, when planning a share sale:

The legislation must be analyzed very carefully
Contracts should be carefully drafted
If necessary, expert legal and financial advisor support should definitely be sought.

Zoning law, Zoning Act, Istanbul Lawyer, urban transformation, risky building

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