What are the rights of property owners in urban transformation projects?

The urban transformation process is a significant legal process aimed at demolishing risky buildings and constructing safe and modern ones in their place. However, this process is not merely a technical construction activity. Urban transformation directly affects property rights, land shares, independent unit rights, contractual relationships, eviction processes, rental assistance opportunities, and claims against the contractor.

Therefore, it is extremely important for property owners to know their rights in urban transformation projects. Property owners have legal rights at every stage, from the assessment of a risky building to signing a contract with the contractor, from the evacuation of the building to the delivery of new independent units. Failure to know or misuse these rights can result in significant economic losses for property owners.

The most common problems encountered in practice arise from issues such as property owners signing the contract without reading it, granting broad powers to the contractor, incorrect assessment of land shares, leaving the delivery time uncertain, not including penalty clauses, not regulating rental assistance and delay compensation, and not knowing the avenues for redress in case of incomplete or defective delivery.

To protect the rights of property owners during the urban transformation process, each stage must be carefully monitored, and legal support should be sought, especially before signing the contract.

Who is the property owner in urban transformation projects?

In urban transformation projects, the owner is the person who holds property rights over the risky building or the property subject to transformation. In an apartment building subject to condominium ownership, those who own independent units are considered owners. In shared ownership or joint ownership, those who own a share in the property have the status of owner.

Ownership is crucial in the urban transformation process. This is because rights such as identifying risky buildings, the right to object, participation in owner meetings, decision-making, signing contractor contracts, participating in the land share sale process, acquiring new independent units, and filing lawsuits depend on ownership status.

Tenants are not owners, even though they physically use the property. Therefore, tenants' rights are considered under a separate heading. Tenants may have certain rights regarding eviction, relocation, and the rental relationship; however, they cannot participate in the decision-making processes of the owners as if they were owners.

Property Owners' Right to Have a Building Assessed for Risks

One of the starting points of the urban transformation process is the identification of risky buildings. One of the owners can apply for a risk assessment without obtaining the approval of the other owners. This right is important in determining whether the building is truly at risk.

In some buildings, not all owners may agree on the transformation. Some owners may want the building renovated, while others may want the existing structure preserved. However, since building safety is also linked to public order and life safety, the process of identifying a risky building can be initiated with an application from a single owner.

Property owners who wish to have their buildings assessed for risk can apply to an authorized and licensed organization to request a technical inspection of the building. If the building is found to be at risk as a result of the assessment, the urban transformation process legally begins.

Property Owners' Right to Appeal the Determination of Buildings as Risky

Owners have the right to appeal if a building is identified as a risky structure. After the risky building report is served to the owners, they can appeal within the specified time frame. This right protects owners against reports that are incorrectly or incompletely prepared.

Objections to a building assessment deemed risky should not be based solely on general statements such as "our building is sound." The objection must be supported by technical and legal grounds. Reasons such as sample collection errors, incomplete inspections, incorrect assessments, improper notifications, or reports prepared by unauthorized organizations can be grounds for objection.

Since the objection period is short, property owners need to act quickly after receiving the notification. If the deadline is missed, the risky building assessment may become final, and the eviction and demolition process may begin.

Property Owners' Right to Be Informed

Property owners have the right to be accurately and completely informed about the urban transformation process. Risk assessment reports, notifications, property owner meetings, minutes of meetings, contractor proposals, draft contracts, project documents, and title deed transactions should not be concealed from property owners.

In practice, some property owners are excluded from the process, not informed of meetings, or asked to sign without being given a draft contract. Such practices may lead to legal disputes in the future.

Property owners have the right to examine any document they intend to sign beforehand and to seek legal advice when necessary. No property owner can be forced to sign a contract whose contents they do not know or understand.

Owners' Right to Attend Meetings and Vote

Decisions regarding how a property will be valued in urban transformation projects are made with the participation of the property owners. Owners have the right to attend meetings, express their opinions, object, and vote.

Meeting notices must be properly served, the agenda clearly stated, and the decisions made must be communicated to the property owners. Meetings held without the property owners' knowledge or decisions made improperly may be subject to legal disputes.

Owners' voting rights are generally assessed in relation to their land shares. Therefore, it is important that land shares are determined correctly. In buildings where land shares are incorrectly determined, the decision-making process can also become contentious.

The Right of Owners to Disagree with the Majority Decision

In urban transformation projects, a majority decision is crucial. However, not every property owner is obligated to agree with the majority decision. Property owners can object to the selection of the contractor, the terms of the contract, the division of independent units, the calculation of goodwill payments, or other decisions.

However, the situation of the owners who did not agree with the decision may have special consequences. Under certain conditions, the sale of the land shares of the owners who did not agree with the decision may come into question. Therefore, owners who do not agree with the majority decision should exercise their rights consciously.

Disagreeing with the decision is not sufficient on its own. Malik must concretely demonstrate why the decision is unlawful, how it infringes upon his rights, and what irregularities have occurred. Administrative and judicial remedies should be considered if necessary.

Property Owners' Right to Participate in Contractor Selection

Choosing a contractor is one of the most critical decisions in the urban transformation process. Property owners have the right to express their opinions and participate in the decision-making process regarding which contractor to work with.

When selecting a contractor, simply submitting the highest bid is not sufficient. The contractor's financial strength, technical competence, completed projects, ability to provide guarantees, experience in the licensing process, and contract terms must be evaluated.

Property owners can request documentation from the contractor regarding the project, payment schedule, delivery time, rental assistance, security deposit, previous work experience, and company information. If the contractor has a history of unfinished projects or financial problems, this poses a significant risk to the property owners.

Property Owners' Right to Examine the Contract

In urban transformation projects, the contract with the contractor is the most important legal safeguard for property owners. Therefore, property owners have the right to examine the contract in detail before signing it.

The contract must clearly specify the delivery time, permit acquisition time, construction start date, penalty clauses, rental assistance, security deposit, division of independent units, transfer of land shares, title deed procedures, liability for incomplete and defective work, common areas, parking, and storage rights.

Property owners can have their lawyer review the draft contract. Signing the contract under pressure from the contractor or majority owners to "sign immediately" may result in a loss of rights. The fact that the contract is notarized does not mean its content is in the property owner's favor. What matters is that the contract contains clear, balanced provisions that protect the property owners' rights.

Owners' Right to Reserve Their Excess Rights

In urban transformation contracts, it is important for property owners to reserve their rights regarding additional claims. This is because claims may arise during the process for differences in square footage, differences in goodwill, incomplete delivery, delay compensation, loss of rent, decrease in value, or defective workmanship.

The owner should pay attention to broad release clauses indicating that they are waiving all their rights when signing the contract. Some contracts may contain clauses that could prevent owners from making future claims against the contractor or other owners.

Therefore, the contract must reserve the owners' rights regarding any excess amounts, claims for compensation, rights arising from incomplete or defective work, and claims for goodwill differences.

Owners' Right to Request an Independent Unit

The contract must clearly specify which independent unit each property owner will receive after urban transformation. There may be differences in location, facade, floor, square footage, and value between the property owners' old and new independent units.

Therefore, the division of independent units should not be left vague, simply stating "each owner will receive one apartment." It must be clearly stated which independent unit each owner will receive, including the unit number, floor, facade, net and gross square footage, and parking and storage rights.

Unclear allocation of land can lead to serious disputes after construction is complete. Clear regulations are necessary, especially regarding valuable facades, shops, rooftops, garden uses, and parking areas.

Owners' Right to Claim Betterment and Value Difference

In urban transformation projects, not every independent unit may have the same value. Floor, facade, view, usable area, parking, garden, shop location, and square meter differences all affect the value of independent units. Therefore, calculating the goodwill value is important.

Property owners may claim goodwill or a difference in value if they believe that their allocated independent unit is worth less than their rights in the original property. However, for this right to be exercised, the calculation of the goodwill must be explicitly stipulated in the contract.

Distribution without considering the goodwill value can lead to some owners unfairly gaining an advantage while others suffer a loss in value. Therefore, the division of independent units during the transformation process should be done with expert evaluation.

Property Owners' Right to Rent Assistance and Relocation Support

When a building is evacuated during an urban transformation process, owners become unable to use their homes or workplaces. Therefore, owners may have the opportunity to benefit from rental assistance or relocation support. The conditions, application procedures, and deadlines for these supports should be evaluated according to the relevant legislation and administrative practices.

Additionally, the contract with the contractor may stipulate that rental assistance will be paid to the property owners. In this case, the amount of rental assistance, the payment date, the number of months it will last for, what will happen if there is a delay, and which property owners will receive it should be clearly stated.

If the contractor fails to pay the rental assistance, the property owners may have rights to claim compensation. Therefore, rental assistance should be clearly and enforceably regulated in the contract.

Property Owners' Right to Claim Delay Compensation

Failure to complete construction on time is a common problem in urban transformation projects. The contractor may obtain the permit late, start construction late, or exceed the delivery deadline. In this case, property owners may experience loss of rent, loss of use, and economic damage.

Property owners can claim a penalty or compensation for delay if stipulated in the contract. It is easier for property owners to assert their rights if the delivery date and penalty clause are clearly stated. However, if the delivery date is unclear in the contract or no penalty clause is included, the dispute becomes more complicated.

Therefore, property owners should specifically check the delivery time and penalties for delays before signing the contract.

Owners' Rights Against Incomplete and Defective Delivery

The contractor is obligated to deliver the new building in accordance with the contract, project, permit, and technical specifications. Incomplete work, defective workmanship, use of low-quality materials, unfinished common areas, lack of parking or storage, plumbing problems, and failure to obtain an occupancy permit affect the rights of the property owners.

Property owners may file claims against the contractor for incomplete or defective work. These claims may include demands for completion of incomplete work, remedy of defects, price reduction, compensation, or other rights arising from the contract.

It is important to have a record kept during delivery, to report any deficiencies or defects in writing, and to have evidence collected when necessary. Otherwise, proof problems may arise later.

Property Owners' Right to Protection Regarding Title Transfer

One of the riskiest issues in urban transformation contracts is the transfer of title deeds. Some contracts may initially grant the contractor extensive title deed transfer powers. This can lead to the contractor selling the independent units to third parties before completing the construction, causing hardship for the property owners.

Property owners may request that the transfer of title be carried out in stages. For example, the title transfer can be arranged depending on stages such as obtaining the building permit, laying the foundation, completing the rough construction, and obtaining the occupancy permit.

Additionally, including clauses such as security, mortgage, bank guarantee letter, or penalty clauses in the contract provides protection for the owners. Obtaining legal oversight before the transfer of title is of great importance.

Property Owners' Right to File a Lawsuit

Property owners have the right to file lawsuits during the urban transformation process. These may include administrative lawsuits against risky building assessments, legal appeals against property owner decisions, claims for receivables and compensation against contractors, contract termination, lawsuits for incomplete and defective work, lawsuits for delay compensation, and lawsuits for land share adjustments.

Which type of lawsuit should be filed is determined by the specific dispute. Time limits, the competent and authorized court, evidence, and claims must be carefully considered.

Property owners should gather evidence, preserve contracts and correspondence, review court records, and send notices if necessary before filing a lawsuit.

Property Owners' Right to Request Provisional Injunctions

In some cases, property owners may need to request a precautionary measure to protect their rights. This is especially true in situations where there is a risk of the contractor transferring the properties to third parties, irregular title deed transactions, transfers contrary to the contract, or the construction being left unfinished.

An interim injunction can protect rights over real estate until the conclusion of a lawsuit. However, the request for an injunction must be based on concrete evidence and the risk of loss of rights must be clearly demonstrated.

Requests for protective measures in urban transformation projects should be made without delay. This is because protecting rights can become more difficult after the transfer of title or sale to third parties has taken place.

Property Owners' Rights in the Land Share Sale Process

The sale of the land shares of owners who do not agree with the majority decision may come onto the agenda. This process has extremely serious consequences for the owner, as they may face the risk of losing their share in the property.

In the land share sale process, valuation, notification, auction, sales terms, and procedural steps should be carefully examined. If the owner believes the sale transaction is unlawful, they should consider legal remedies within the prescribed time limit.

Property owners who do not agree with the decision should not passively wait for the process to protect their rights. Valuation reports, minutes of the decision, and sales documents must be carefully examined.

Property Owners' Right to Obtain Legal Support

Property owners have the right to legal assistance during the urban transformation process. They can act through a lawyer in processes such as risk assessment of buildings, objections, property owner decisions, contractor contracts, title transfers, warnings, lawsuits, and mediation.

Legal support is especially important during the contract phase, because reversing a signed urban transformation contract can be difficult. Drafting the contract in favor of the property owner prevents future disputes.

An urban transformation lawyer prepares contractual provisions that protect the rights of property owners, identifies risks, pursues legal avenues in case of disputes, and prevents loss of rights.

Conclusion

Property owners have numerous legal rights in urban transformation projects. These rights include having a risk assessment of the building, objecting to such assessments, attending meetings, voting, reviewing contracts, participating in contractor selection, requesting independent units, claiming betterment and value differences, receiving rental assistance, claiming compensation for delays, filing applications against incomplete and defective work, initiating lawsuits, and requesting preliminary injunctions.

However, careful consideration must be given from the outset of the process to ensure these rights are exercised effectively. Property owners should not sign documents without reading them, should subject the contract terms to legal scrutiny, and should safeguard their rights against the contractor.

When managed correctly, urban transformation processes provide property owners with safe and valuable real estate. However, serious losses of rights can occur in processes carried out without legal support. Therefore, it is of great importance for property owners to seek support from an experienced lawyer during the urban transformation process.