Jerusalem Real Estate Scandal Topples Giants, Buildings Remain Standing


The "Holyland Park" apartment complex in Jerusalem. (image by Adiel lo, via Wikipedia)

A massive corruption scandal involving some of the most powerful people in Israel and an almost universally loathed building complex in Jerusalem has highlighted the need for tighter regulation of the country's land planning system. But this hasn't stopped the Prime Minister from pushing his plan to radically deregulate the planning system. Quite a few ugly buildings have been built in Jerusalem in recent years, but none have been as traumatic for the people of the city as the Holyland Park project, known to most simply as "Holyland." Built about a decade ago on what used to be a pine-covered hilltop in southern Jerusalem, the neighborhood contains almost 1,000 luxury apartments in a row of buildings that stick out like a sore thumb on the city's modest skyline.

Back in the 1990's, the project was rejected by planning authorities for sloppy and unprofessional planning. A few years later, however, Jerusalem's local planning committee approved a vastly expanded version of the project, ignoring protests from neighbors and environmental groups. What made the authorities change their minds? Apparently, millions of dollars in bribes to key officials.

Holy Scandal

The Holyland scandal broke in early April, and since then barely a day has gone by without some new senior figure being implicated. Thus far, two former deputy mayors, a former mayor, the former city engineer and even former Prime Minister Ehud Olmert (also a former mayor) have been named as suspects, along with a host of political cronies and the project's developers.

The affair has been described as the biggest corruption scandal in the Israel's history, and the country's National Fraud Squad is reportedly focusing exclusively on it, with all other investigations put on hold.

Planning Reform in Doubt

The scandal, which has exposed the weaknesses of Israel's planning system for all to see, broke at a particularly inconvenient time for current PM Benjamin Netanyahu, whose attempt to push through an already controversial reform of the planning system no longer seems like such a wise idea. Worse still, it turns out that one of the architects of Netanyahu's reform apparently used to work for the developers of Holyland.

Critics of the PM's reform, who claim it would benefit real estate developers at the expense of the public, have latched onto the Holyland scandal as proof that the planning system needs to be bolstered, not weakened.

Last week, at an Earth Day ceremony, environmentalists sarcastically granted the PM a "black globe" for his attempts to promote the reform.

Netanyahu has responded by ordering a "reassessment of oversight mechanisms" in the new law, but opponents are calling on the government to scrap the current reform altogether and start formulating a new one - this time, with the participation of the public and the NGO community.

The 'Holyland' Effect

Meanwhile, in the wake of the scandal, exposing questionable real estate projects that fell through the cracks has become the new national sport (the local press has deemed this "the Holyland effect").

In Jerusalem, a city councilor has asked the police to investigate how an apartment complex was approved in place of a soccer field, while its developers were exempted from paying tens of millions of dollars in betterment taxes. In Tel Aviv, a residents' organization is appealing against the approval of a hi-rise planned for their neighborhood, claiming the building's architect was implicated in the Holyland scandal. In Haifa, a city council member put together a list of seven shady real estate projects which he says must be stopped before they become local 'Holylands'.

These efforts could turn out to be just the tip of the iceberg, as Israel's big cities are littered with dubious real estate deals and seemingly arbitrary planning decisions - all of which are now potentially suspect as the next Holyland.

Tags: Israel

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