Compulsory purchases for Metro will cost over NIS 10b

Globes has learned that the cost of the compulsory purchase of land for the purposes of constructing the subway network in and around the Gush Dan area of ​​Tel Aviv will be no less than NIS 10 billion, making the compulsory purchase the largest ever undertaken in Israel. In order to build the three planned metro lines in Gush Dan, thousands of properties will need to be acquired for stations, berths for drilling machines, ventilation shafts, and warehouse areas, and the amounts that will be involved in compulsory purchase orders are now revealed.

Last February, NTA – Metropolitan Mass Transit System Limited (NTA), the metro project’s implementing company, initiated the first set of compulsory purchase orders, sending about 11,000 notices to 900 properties. In that round, 2,300 dunums of land were confiscated, out of 11,000 dunums required for the project. The cities where compulsory purchase orders are being issued are Tel Aviv, Petah Tikva, Holon, Bat Yam, Or Yehuda, Kiryat Ono, Kiryat Ono, and Rishon Lezion, where the first two planned metro lines have been approved for construction, the M3 and the central part of the M1 will pass. .

Most of the residential properties that will need to be expropriated are located along the M2 line, which was only approved in May, so most compulsory purchases remain in place. In total, about 200,000 compulsory purchase notices will be issued, and the process will occur relatively quickly. Under the Metro Law passed by the Knesset, the state can mandatorily purchase land not only for public needs, but also for commercial uses, which are part of the project financing model.

The three metro lines pass under 24 local authorities, and 109 stations will be established in them. The official opening date is between 2034 and 2037, but unofficial estimates put it closer to 2040. The estimated cost is NIS 150 billion, half of which will be financed by the state and the other half from the metro tax on property owners and local authorities that will finance the benefit from the rising value. Real estate along metro lines and commercial use of stations and terminals, and congestion charges are scheduled to take effect in Gush Dan in 2026.

The National Tourism Authority and government ministries preferred not to announce the cost of the compulsory purchases that will come out of the project budget, but sources familiar with the matter believe that it will exceed 10 billion shekels.

In any case, the inspection phase of the 900 properties scheduled to be compulsorily purchased in the first round for the purposes of estimating the compensation due has begun. Compensation is divided into two parts: the decrease in the value of the property as a result of compulsory purchase and rezoning (for example from housing to a metro station), and the value of the land itself and the buildings on it. The NTA decided that whoever agrees with it and refrains from filing a lawsuit due to confiscation will receive an additional compensation of 25%, up to a maximum of one million shekels. The aim is to speed up the process and avoid lengthy legal procedures as much as possible.

Meanwhile, work on metro construction continues. So far, four of the five plans to build the three lines have been legally approved, and the National Tourism Authority and planning authorities are working on detailed planning of the lines. Last year, the companies that would manage work on the lines were chosen at a cost of 8 billion shekels. The winning companies are Israeli and international companies, and are set to employ hundreds of workers to plan and build the metro, although many of these workers currently find it difficult to reach Israel due to the war.

The project has not started yet, and is already behind schedule. Work on providing land in some sections was supposed to be completed by now, but it has not yet been completed. Compulsory purchases also began late, after Transportation Minister Miri Regev refused to sign compulsory purchase orders until the government approved the construction of railway lines to Kiryat Shmona and Eilat. In the end, it was decided that these lines would be allocated for planning at a cost of NIS 2.4 billion from Regev’s ministry budget (the construction cost would be tens of billions of shekels), and then agreed to sign the agreement. Requests.

Published by Globes, Israel Business News – en.globes.co.il – on October 1, 2024.

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