Urban Transformation Finance

Reinforcement

Applied to high-risk structures.
It involves reinforcing the existing building using reinforcement methods without demolishing it.
The cost of reinforcement is financed by the unit owners.
Advance payments/down payments made by unit owners and financing provided by Emlak Katılım are deposited into a blocked account held in pledge by the contractor with Emlak Katılım and are released by Emlak Katılım on a progress-based payment schedule.

On-Site Renovation

Applied to high-risk buildings.
It involves the demolition and reconstruction of the existing building without an increase in floor area ratio.
The project construction cost is financed by the unit owners.
Advance payments/down payments made by the unit owners and financing provided by Emlak Katılım are pooled in the contractor’s blocked account pledged to Emlak Katılım and are released by Emlak Katılım on a progress-based payment schedule.

Area-Wide Redevelopment

Applied to high-risk buildings.
The financing structure is determined based on the type of agreement between the unit owners and the contractor.

• Condominium owners apply to organizations authorized by the Ministry of Environment and Urbanization to have their buildings assessed for risks.
• Based on the “High-Risk Building Assessment Report” obtained from the authorized organization, apartment owners in buildings identified as high-risk must pass a resolution by a two-thirds majority to demolish and rebuild the building, or by a four-fifths majority to implement building reinforcement measures.
• For buildings where a demolition decision has been made, a “Construction Contract” is signed between the unit owners and a contractor, and a building permit is obtained from the municipality through the contractor.
• For buildings where a reinforcement decision has been made, if the building is suitable for reinforcement, a contractor is selected, and a contract is signed between the unit owners and the reinforcement contractor; a reinforcement permit is then obtained from the relevant local municipality through the contractor.
• The unit owners submit an application for urban transformation financing to Emlak Katılım.

• Emlak Katılım evaluates the contractor, the technical specifications of the construction project, and the contract between the unit owners and the contractor; for eligible projects, a “Project Completion Protocol” is signed between the Bank and the contractor.
• Emlak Katılım reviews the applications submitted by the unit owners and approves those it deems eligible. Emlak Katılım transfers the financing amounts, down payments, and other amounts to the contractor’s escrow account pledged to Emlak Katılım.
• Emlak Katılım releases the pledged amounts to the contractor in installments based on the physical progress of the construction, in accordance with the completion protocol signed with the contractor.
• Emlak Katılım provides urban renewal financing to unit owners with favorable profit-sharing rates, offering terms of up to 120 months for renovation and residential financing and up to 84 months for commercial property financing. Additional government support is available for the Urban Renewal Financing that unit owners obtain from Emlak Katılım.