Demolition and reconstruction in co-ownership: what does the law say?
An apartment block, an office site or a mixed complex with residential and commercial functions: when a co-owned building is structurally obsolete or no longer meets technical and legal requirements, demolition and redevelopment is often inevitable. But how do you, as a co-owner, take such a drastic decision in a legally correct manner? What agreements do you make beforehand - even as a project developer - to ensure that the process goes smoothly? Attorney Stefanie Claeys, who specializes in real estate law, explains the possible pitfalls and regulations.
Redevelopment within an association of co-owners: what does article 3.88 of the Civil Code say?
The Civil Code states in article 3.88, 2° h that the general meeting of co-owners decides by a four-fifths majority to completely demolish and reconstruct the building, unless the basic deed explicitly deviates from this. If that decision is not unanimous, then ratification by the justice of the peace is required.
“That sounds clear on paper,” says Stefanie Claeys, "but in practice this is rarely an evident course. Because of the construction of these buildings and the whole legal constrcution around it, the creation of a new co-owner's association is also necessary. Without a legal structure and without prior agreements, every next step quickly becomes a source of discussion."
Clear agreements before the foundation stone disappears
Rebuilding a building starts with clear agreements. Who takes the initiative? How will the costs be divided? Who gets what after completion? And what if one co-owner drops out?
In practice, there is often cooperation with a construction promoter, who carries out the redevelopment and acquires additional building rights in exchange. Such a cooperation requires a legally conclusive framework. Minutes of the general meeting rarely suffice. Experience shows that additional agreements are needed, both between co-owners and with the construction promoter, to make the project legally and practically workable. The drawing up of a new basic deed also deserves special attention from the start.
As soon as the building disappears into co-ownership, agreements about ownership, cost-sharing and reconstruction must be set down in black and white.
What about article 3.88 BW and the developer? Roles, risks and permits
If you step into a redevelopment project as a property developer, it is usually in exchange for the right to develop and sell additional housing units. That involvement requires a clear delineation of roles: what position do you occupy within (or alongside) the VME? With whom do you enter into contracts, and under what conditions? The permit process also requires a thoughtful approach, from the application for an environmental permit to possible deviations from urban development regulations. Clear agreements from the start prevent discussions along the way and increase the success rate of the entire project.
Customized legal guidance, from real estate contract to compensation agreement
Do you have questions about Article 3.88 of the Civil Code or a concrete redevelopment project? NOMA's attorneys carefully guide owners, promoters and syndicates through the process. Strategically, carefully and legally conclusive, with an eye for the whole and the detailed agreements.
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