New Ratio (Simple Majority 50%+1) and Process in Urban Transformation

Regarding procedures related to risky buildings, decisions must be made by a minimum two-thirds (2/3) majority of the owners, proportional to their shares. The 2/3 majority mentioned in the law was not 2/3 of the total number of owners, but 2/3 of the owners in proportion to their shares. (If there is a condominium/floor ownership deed, land shares are taken into account.)

However, Article 10 of Law No. 7471 on the Transformation of Areas Under Disaster Risk and Amendments to Certain Laws and Decree Law No. 375, published in the Official Gazette No. 32364 on November 9, 2023, changed the phrase "at least two-thirds" to "simple." Accordingly, a simple majority (50% + 1) of the shareholders in proportion to their shares will suffice for all decisions regarding real estate. With this change, the urban transformation process can be initiated with a simple majority in projects where the 2/3 majority cannot be achieved. Article 10 refers to the amendments to Article 6 of Law No. 6306, and the fifteenth paragraph added to Article 6 of Law No. 6306 by Article 10 states:

The simple majority rule in urban transformation has been introduced by Law No. 6306. Those who own independent units in a condominium building or who are co-owners of a property; when their building is deemed risky and needs to be demolished, and the land or site is left vacant or given to a contractor, they are allowed to dispose of the entire property if 2/3 of the co-owners or independent unit owners give their approval.

In the demolition of a building identified as risky or located in a risky area, the agreement of the co-owners is irrelevant. In other words, even if the co-owners reach a unanimous agreement, they have no say in the demolition of buildings located in risky areas or, even if they are not in a risky area but are deemed safe, buildings whose demolition has been decided upon. The demolition of the structures that have been decided upon is mandatory.

Urban transformation comes into play when a simple majority decides on the type of structure to be built in place of the demolished building, or when a decision is made regarding the demolition process. Property owners who come together to determine the status of the land after the demolition decide how they want to use it.

The property owners can choose to have the land developed themselves, give it to a contractor in exchange for apartments, leave it entirely as land, or decide to sell it.

If all property owners reach a common decision, there will be no problem, and the method decided upon by unanimous vote will be applied to the land. The simple majority rule comes into play when the shareholders cannot agree. If a decision cannot be made on the land, the decision made by the simple majority is legally binding on the other group of shareholders.