Israel Sues Amidar-Halamish for $15 Million Over Public Housing Funds

Israel’s Ministry of Construction and Housing filed a lawsuit today (Sunday), through the State Attorney’s Office, against Halamish. The state is asking the court to declare that it holds the rights to approximately 1,314 apartments designated for eligible public-housing residents in Tel Aviv. The Housing Ministry is demanding that Halamish return tens of millions of shekels that belong to the state and are allegedly being held unlawfully by the company.

According to a statement issued by the State Attorney’s Office, the lawsuit filed in the Tel Aviv court states that public housing in Israel is intended to provide housing solutions for people who cannot afford to buy or rent an apartment on the private market. The Ministry of Construction and Housing manages the program through companies that manage public-housing properties for eligible residents.

The state financed approximately 99% of the capital used to purchase the apartments, but the apartments were registered in the name of Halamish — a government-municipal company jointly owned by the state and the Tel Aviv Municipality. The lawsuit alleges that in recent years, Halamish unilaterally changed its position and began claiming ownership of the apartments.

It acted to register public-housing properties in its own name with the Land Registry offices without the state’s consent, refused to allow new apartments built as part of urban renewal projects to be registered in the state’s name, and even sold public-housing apartments while refusing to transfer the proceeds from those sales to the state. The state claims that Halamish unlawfully retained approximately 50.8 million shekels beyond its share of the profits from selling the apartments to their tenants.

The state asked the court to declare that it holds the rights to the apartments, order that the rights be registered in its name, and cancel registrations made in favor of Halamish. In addition, the state is asking the court to bar Halamish from taking actions as the owner of the properties without authorization, require it to return funds that the state says were unlawfully withheld, pay the full value of assets sold to third parties without the state’s approval, and determine that Halamish violated its obligations under the management agreement.