Commercial real estate in Turkey: overview

A Q&A guide to corporate real estate law in Turkey.

The Q&A gives a high level overview of the corporate real estate market trends; real estate investment structures, including REITs; legislation; title and public registers of title; confidential information; state guarantee of title; tenure; sale of real estate; seller's liability; due diligence; warranties; cost; taxes and mitigation, including VAT and stamp duty/transfer tax; climate change targets; third party outsourcing; restrictions on foreign ownership or occupation; finance; leases; planning law and consents; and proposals for reform.

To compare answers across multiple jurisdictions, visit the Corporate Real Estate Country Q&A tool

This Q&A is part of the global guide to corporate real estate law. For a full list of jurisdictional Q&As visit www.practicallaw.com/realestate-mjg.

Contents

The corporate real estate market

1. What have been the main trends in the real estate market in your jurisdiction over the last 12 months? What have been the most significant deals?

Turkey is the largest economy of Central and Eastern Europe, and the sixth largest in Europe. Despite the economic slowdown all over Europe, Turkey recorded a relatively high economic growth among emerging countries last year. The Turkish investment market has gained significant liquidity, with a number of major transactions completed over the last six to eight months.

Following the law adopted in 2012 that removed the reciprocity rule and allowed foreigners to purchase real estate in Turkey, many foreign investors have entered the Turkish market. We expect this trend to continue. The high demand for office space in big cities such as Istanbul, Ankara, İzmir and Bursa will probably attract market players to enter into office projects.

Parliament adopted a new Redevelopment Law 28374 on 4 August 2013, requiring the modification of buildings to provide earthquake resistance. The new redevelopment law will drive new projects in areas at earthquake risk. Under this new law, around 50% of buildings in Turkey will be retrofitted, while at-risk areas will be restructured to create a safer living environment. As the law is recently adopted, the Housing Development Administration (TOKİ) and private investors are expected to announce a large number of new real estate projects. There will be many properties with high values and demand.

Commercial real estate investments were the most profitable real estate investments in 2014. Commercial real estate prices in Istanbul increased by up to 42% and the square metre price of commercial units reached TRY6,000 on average. The highest profit margin was in Bahcelievler, where the average square metre price reached TRY5,041 and investors made profits of up to 96%. The second highest profit margin was in Bakirkoy with 70%. In Bakirkoy, the square metre price of offices reached TRY6.919 on average.

Investors who invested in land (about 26% residential real estate) in Istanbul made profit of up to 25% on average. In Beykoz, a town in North Istanbul, land prices increased 162% on average, whereas in Catalca the increase was 38% on average, 23% in Arnavutkoy and 8% in Silivri.

There were major shopping mall openings in Istanbul in 2014, such as the 154,000 square metres Mall of İstanbul, 80,000 square metres Akasya Acıbadem, 45.000 square metres Ozdilek AVM, and 40,000 square metres Canpark Ümraniye. There were also mall openings in Anatolian cities. Palerium in Erzurum, East Anatolia and Ceylan Karavil Park in Diyarbakir, South East Anatolia are among these new shopping malls opened in 2014.

Denizbank's 60,000 square metres rental of Torun Plaza in Esentepe/Istanbul was among the important commercial real estate rentals in 2014. The bank moved its headquarters to Torun Plaza at the end of 2014.

Levent 199, which has a 122,000 square metres sellable area, Kristal Kule, which has a 50,000 square metres sellable area and River Plaza with a total sellable area of 37,000 square metres were among the new offices supplied into the market in 2014.

 

Real estate investment

2. What structures do investors typically use for real estate investment in your jurisdiction and what are the main advantages and disadvantages of each (for example, flexibility and tax transparency)?

Property companies and partnerships are the common structures used in the real estate market.

Real estate investment trusts (REITs) are available in Turkey. However, in proportion to the size of the Turkish real estate market, they are relatively uncommon.

 
3. What are the main sources of finance and types of investors for real estate investment in your jurisdiction? Does your government encourage overseas investment into real estate in your jurisdiction, for example through real estate investment legislation?

The Housing Development Administration (TOKI) is a non-profit government administration, with a target group of low and middle-income families who are not able to own a housing unit. It is the most active institutional investor in the market. It participates in a significant amount of transactions relating to all real estate projects in Turkey. It usually enters into sub-contractor agreements with third party contractors, and shares the profit from sales of the projects. It also sells land owned by the public administration from time to time.

Private investors usually enter into profit share construction projects with landlords, or enter into projects on land they own. It is also common for private investors to takes part in Housing Development Administration tenders and construction projects.

 

Restrictions on foreign ownership or occupation

4. Are there restrictions on foreign ownership or occupation of real estate (including foreign ownership of shares in companies holding real estate)? Are there restrictions on foreign guarantees or security for ownership or occupation and on lending for the purchase of real estate?

The condition of reciprocity for foreigners who wish to buy property in Turkey has been abolished (Article 35, Land Registry Law 2644, amended by Law 6302, which entered into force on 18 May 2012).

Permission to buy real estate in Turkey is required for:

  • Real persons.

  • Companies with foreign shareholders representing more than 50% of their share capital.

  • Companies where a foreign shareholder can appoint a manager or representatives of this company.

Permission is obtained from a division of the governor's office where the real estate is located. Foreign companies cannot own real estate without obtaining permission in Turkey. However, there are some exceptions relating to companies in certain sectors, such as petroleum, tourism and industrial companies.

Information on countries whose citizens can buy real estate in Turkey is available from Turkish embassies and consulates abroad, and the General Directorate for Land Registry and Cadastre.

Foreign persons can buy any kind of property (house, business place, land or field) within the legal restrictions.

Foreign persons who buy property without construction have to submit details of any construction project to be built on the land to the Ministry of Environment and Urban Planning, within two years of acquiring the real estate. In addition:

  • Foreign persons can buy up to 30 hectares of property in Turkey, and can acquire a limited in rem right.

  • Foreign persons cannot acquire or rent property in military forbidden zones and security zones.

  • Foreign persons can acquire property or a limited in rem right in a district/town up to 10% of the total area of the district/town.

  • Legal restrictions do not apply to granting a mortgage to real persons and commercial companies with legal personality that are established in foreign countries.

  • Foreign real estate ownership can be terminated in the following cases:

    • the property is acquired in violation of laws;

    • the relevant ministries and authorities identify that the property is used in violation of the purpose of purchase;

    • the foreign person does not apply to the relevant ministry in time where the property is acquired with a project commitment; and

    • projects are not completed on time.

When obtaining the permission stated above, only parcel numbers are examined, and there is no examination for each independent section concerning acquisitions within the scope of Articles 35 and 36 of the Land Registry Law. In other words, if an examination is carried out and an approval for a real property is obtained, other acquisition transactions on the same map section/parcel will be completed without having new correspondence with the authorities.

 

Title to real estate

5. What constitutes real estate in your jurisdiction? Is land and any buildings on it (owned by the same entity) registered together in the same title, or do they have separate titles set out in different registers?

Real estate includes (Civil Code):

  • Land.

  • Independent and permanent (imprescriptible) rights registered in separate pages of the land register.

  • Independent sections registered in different parts of the land register, for example buildings or apartments.

Types of real estate include:

  • Land.

  • Flat easement, which is the ownership of a certain share of the land (kat irtifaki).

  • Condominium (kat mülkiyeti), which is the ownership of a certain independent section of a building.

The main rule is that a building on land is registered in the same title. However, there are some exceptions. For example:

  • If a right of construction is given to a third party, the resulting building may be registered in a separate title, depending on the case.

  • If a building with independent sections (for example, apartments) is constructed on land, each separate section will be registered in a different part of the land register. The previous entry in the land register will be closed, stating that the land is subject to condominium rights.

 
6. How is title to real estate evidenced? What is the name of the public register of title and the authorities responsible for managing it? Is electronic access and electronic conveyancing available?

Title is evidenced by registration in the land register. The land register is managed by the General Directorate of Land Registry and Cadastre (Tapu ve Kadastro Genel Müdürlüğü). This is a public institution responsible for keeping the land registers, and co-ordinating cadastre activities (www.tkgm.gov.tr). Each district has a separate land register.

 
7. What are the main information and documents registered in the public register of title? Can confidential information or documents be protected from disclosure in the public register of title?

In the land register, each item of real estate has a separate page. In the head section, there is general information about the real estate such as:

  • The owner.

  • Size of the real estate.

  • Description of the real estate.

  • Plot and section details.

Under the head section, there are several columns giving the following detailed information:

  • Ownership column.

  • Annotations column.

  • Easement rights column.

  • Comments column.

  • Pledges column.

The land register is open to the public. Anyone, proving that he has an interest in reviewing the land register, is allowed to review the land register. The meaning of interest is not limited, and is considered as any lawful interest, such as an intention to buy the land, preparing an academic thesis, collecting information for a statistical report and so on. Therefore, it is hard to protect confidential information or a document from disclosure.

 
8. Is there a state guarantee of title? Is the authority that manages the public register liable to pay compensation for any errors it makes in relation to title registration? Is title insurance available and is it commonly used?

There is no state guarantee of title as such. However, the state is responsible for incorrect title registrations, provided that the incorrect title registration has caused damage to the relevant person, and the damage arises out of the incorrect title registration.

Title insurance is available and offered by several insurance companies, but is not commonly used.

 
9. How can real estate be held (that is, what types of tenure and other main ownership rights exist over land)?

The most common way to hold real estate is land ownership, namely, buying and holding land with a building on it.

Freehold ownership gives the right of ownership. Leasehold ownership gives the right to use the real estate for a specific period of time but not ownership. The property is returned to the owner at the end of the lease term.

Real estate can also be held through easement rights, including:

  • Usufruct (usage right).

  • Right of habitation.

  • Right of construction.

  • Right of way.

  • Right of natural resources.

  • Right of construction.

 

Sale of real estate

Preliminary agreements

10. What types of preliminary agreements are typically used in the sale of real estate? Are they legally binding?

Real estate is mostly marketed by real estate agents. However, in the last decade and especially after the boost in construction projects, owners of such projects are establishing their own marketing organisations. They are issuing adverts in the media and building their own sale offices at their construction sites. However, real estate agents are still the most active players in marketing.

Usually, commercial negotiation occurs when the investor is interested in buying the real estate, and continues until the parties negotiate the purchase price.

The parties can sign a preliminary sale contract, where the seller undertakes to sell the real estate to the buyer subject to certain conditions, and the buyer undertakes to buy the real estate subject to certain conditions.

A preliminary sale contract can be registered in the land register. If it is registered, the real estate cannot be subject to any sale, pledge or mortgage for the following five years. The buyer can force the owner of the real estate to transfer the title to it, if the conditions in the contract are met. A preliminary sale contract must be signed before a notary and is subject to stamp duty at 0.94% of the contract price.

An ordinary pre-sale contract will not prevent the owner from transferring the real estate to a third party. The buyer can claim damages (and a penalty, if included in the agreement) but will have no right to force a third party to transfer the title to him.

 

Sale contract

11. Briefly outline the typical main provisions of a corporate real estate sale contract and main real estate provisions of a typical share purchase agreement.

The sale contract must be executed by the parties before a land register officer, on application to register the title transfer.

The parties are legally bound at the date they sign the formal sale agreement at the land register.

 

Due diligence

12. What real estate due diligence is typically carried out before an acquisition and what key areas does it cover? Which documents are typically reviewed? Which specialist advisers are usually involved and which reports do they typically produce?

Due diligence typically involves analysing:

  • Public registries to verify title and charges on the real estate.

  • Leases over the real estate (including the lease term and its enforceability, grounds for early termination, rental payments, rent reviews and other obligations).

  • Zoning plans of the land at the relevant municipality.

  • Any licences over the real estate at the relevant municipality, such as construction licences.

  • Town planning rules applicable to the real estate, status of licence granted to operate the property, and compliance of licences with town planning rules.

  • Tax obligations of the property.

  • Environmental aspects of the real estate.

 

Sellers' warranties

13. What real estate warranties are typically given by a seller to a buyer in the sale of corporate real estate and what areas do they cover? What are the main limitations on warranties, for example are they typically qualified by disclosure?

The sale contract is signed at the land register at the same time as the title transfer is registered. The parties can agree that the seller will give warranties to the buyer. Commercial parties usually sign the formal sale agreement at the land registry, which basically states that the parties agree to buy/sell the real estate with its present attachments and/or security (if any).

In any event, information disclosed at the land register is deemed to be disclosed to the parties.

 

Liability

14. Does a seller have any statutory or other liability to the buyer in a disposal of real estate?

The seller must act in good faith without concealing any information that, if known by the buyer, would prevent the buyer from completing the transaction.

The Civil Code provides for legal action against a seller in case of defects. Parties are obliged to fulfil their obligations in good faith (Article 2, Civil Code). If it is obvious that the buyer would not have acquired the real estate if a defect had been disclosed to him by the seller, or the defect can only be found out after a specific period of time, the seller may be liable for not disclosing the information.

The rule of good faith under the Civil Code is a general rule applied to many other specific laws and regulations. For example, the Code of Obligations has several stipulations stating that the constructor of real estate is responsible for defects and faults. For example, a buyer can take action against the constructor if he finds out that the air circulation of an apartment is not working properly due to the building's inappropriate architectural design.

Information disclosed at the land register is publicly available and deemed to be disclosed to the buyer.

 
15. Briefly outline the environmental legislation and potential liability for a buyer in a purchase of real estate. Is it common to carry out environmental surveys and searches and to obtain environmental insurance? How is environmental liability typically dealt with in the sale contract?

The main environmental legislation in Turkey is the Environment Law (2872), adopted on 9 August 1983.

The main principle of the law is that persons who harm the environment must compensate. However, mainly because of the unsuccessful implementation of the law and the absence of relevant sub-regulations, environmental obligations have not been strictly applied until recently.

Environmental insurance is available. However, these insurance packages are more related to industrial environmental obligations and do not attract commercial real estate purchasers.

Environmental Cleaning Tax (Çevre Temizlik Vergisi) is regulated under the Municipality Revenues Law (2464) and is paid by the owner or tenant who uses the property. A purchaser of real estate is only liable for tax that falls due after the purchase (Municipality Revenues Law).

 
16. Can an owner or occupier inherit liability for other matters relating to the real estate even if they occurred before it bought or occupied it? Can a seller or occupier retain any other liability relating to the real estate after it has disposed of it?

The seller and the buyer are jointly responsible for paying any unpaid real estate tax relating to the property. The land register will not transfer title to the real estate until any unpaid real estate tax is paid.

If there is an attachment or security on the real estate, the buyer will be deemed to have accepted all liability regarding the attachment when title transfers. If there is security over the real estate (a mortgage or pledge) the consent of the owner of the security to the title transfer is not needed.

The seller is responsible for construction defects if the seller is the contractor or sub-contractor of the real estate.

 

Completion arrangements

17. What are the typical arrangements and main documents required for completion of the sale? When does title transfer and what are the formal legal requirements to execute the sale documents, transfer the real estate and register the change of title? Is notarisation required?

An application for registration of the title transfer must be made to the relevant land registry. After the application is received, a land register officer will inspect the title and validity of the documents submitted, and prepare the sale contract and invite the parties to sign it. The following documents are required for the application:

  • Identity or passport.

  • Power of attorney drafted by a notary (if needed).

  • Certificate of authority (for companies).

  • A copy of the title deed or information on the real estate.

  • Catastrophe insurance receipt (if the real estate is residential).

  • Two photographs of each party.

Title transfers when the sale contract is signed by the parties before the land register officer at the land register.

 

Real estate tax

18. Is stamp duty/transfer tax (or equivalent) payable on the purchase of real estate? Who pays, what are the rates and are there any exemptions? Does it apply to the transfer of shares in a company holding real estate and at what rate?

The buyer pays real estate transfer tax, which is currently set at 4% of the declared value of the real estate. This is shared equally between the buyer and seller, so that the buyer pays 2%.

In some transactions parties declare the value of the real estate lower than the actual purchase price, to pay less tax. The municipality regulates the minimum values that can be declared. Each year the minimum values are increased. The buyer pays the rate applicable at the time of the transfer.

Stamp duty does not usually apply to a sale made before a land register officer, and almost all sales have to be made before a land register officer.

However, stamp duty at 0.948% does apply to:

  • Sales with mortgages, unless the mortgagee is a bank.

  • Preliminary sale contracts executed before a notary.

Parties share the cost of the stamp duty.

 
19. Are any methods commonly used to mitigate real estate tax liability on acquisitions of large real estate portfolios? What is the general approach of the tax authorities in your jurisdiction to such schemes?

Instead of purchasing real estate, transferring the shares of a company that holds the title to the real estate is commonly used to mitigate real estate tax.

 
20. Is value added tax (VAT) (or equivalent) payable on the sale or purchase of real estate? Who pays? What are the rates? Are there any exemptions?

VAT is payable on the sale of real estate. The rate payable is based on the price per square metre of the land, as determined by the local municipalities.

The rates are as follows:

  • TRY0 to TRY500 per square metre: 1%.

  • TRY500 to TRY1,000 per square metre: 8%.

  • Minimum TRY1,000 per square metre: 18%.

 
21. Are municipal taxes paid on the occupation of business premises? Are there any exemptions?

Property tax is paid to the local municipality, and is 0.2% per year for business premises. It is calculated according to the minimum value declared by the local municipality.

 

Climate change issues

22. Are there targets or incentives to reduce greenhouse gas emissions from buildings in your jurisdiction? Is there legislation requiring buildings to meet certain minimum energy efficiency criteria?

There are no targets to reduce greenhouse gas emissions from buildings in Turkey. There is no legislation requiring buildings to meet certain minimum energy efficiency criteria.

 
23. Are provisions relating to the energy efficiency of buildings commonly included in contracts for the sale of real estate or in leases (for example, green leases)?

Provisions relating to the energy efficiency of buildings are not commonly included in contracts.

 

Real estate finance

Secured lending involving real estate

24. Briefly outline the typical security package required by lenders in relation to real estate lending. How are the most common forms of security interest relating to real estate created and perfected (that is, made valid and enforceable)?

The most common form of security granted over real estate to raise finance is a mortgage. The parties can agree the terms of the mortgage. However, to be enforceable against third parties, an official mortgage agreement must be signed and registered in the land register.

 
25. What other real estate related measures do lenders typically take to protect themselves against default by the borrower?

Lenders usually require a personal guarantee from borrowers. Promissory notes are among other measures that lenders require to protect them against borrower default.

 
26. Can lenders incur environmental liability? What measures do lenders typically take to manage potential environmental liability?

Lenders are not liable for environmental liabilities.

 
27. Briefly outline the main remedies for lenders in relation to the secured real estate if the borrower defaults on the loan. What is the effect of the borrower's insolvency on the lender's remedies?

The lender can foreclose the real estate when the borrower defaults on the loan repayment. Foreclosure is a procedure by which the holder of a mortgage sells the property on the failure of the debtor to pay the mortgage debt and therefore terminates his rights in the property. This legal procedure is carried out by execution offices.

If the borrower is bankrupt, the mortgage holder has priority over the other creditors (Enforcement and Bankruptcy Law). The mortgage holder is deemed as a secured creditor and the proceeds from the foreclosure are not added into the liquidation proceeds to pay the unsecured creditors. If there is more than one secured creditor, the date of establishment of the mortgage is considered when determining the creditors' priority.

 
28. Briefly outline key additional issues for lenders in relation to construction and development projects.

Lenders usually require specific due diligence on the land and the project before entering into a loan agreement. Due diligence includes the review of the legal status of the land as well as the required permit and licences.

Lenders also require specific guarantees from borrowers (project development and construction companies). For example, in real estate and commercial real estate development projects, lenders (banks and financial institutions) make agreements with borrowers to provide mortgage loans to customers of the borrower. These agreements enable borrowers to provide lower mortgage interest rates to their customers. In these agreements, lenders usually require specific guarantees from the borrower (such as a guarantee from the borrower to pay the customer's mortgage loan if the customer defaults, or blocking the borrower's account in which the sale proceeds are collected for a certain period of time).

 

Other real estate financing techniques

29. Are other real estate finance techniques commonly used in your jurisdiction? For example, real estate securitisation and sale and leasebacks.

Real estate is commonly used as security to raise debt finance by granting mortgages and sale and leaseback transactions. Sale and management buyback transactions are also used to raise finance in large shopping centre developments.

 

Real estate leases

Negotiation and execution of leases

30. Are contractual lease provisions regulated or freely negotiable? Which legislation applies?

Contractual lease provisions are generally freely negotiable. There are lease provisions in the Code of Obligations that will apply if the parties have not determined those issues in their lease.

 
31. What are the formal legal requirements to execute a lease? Does the lease have to be executed by certain parties or as a deed? How do the formalities differ for a company, partnership and for individuals?

There are no formal requirements regarding the execution of a lease. The landlord and tenant can come to an agreement even verbally.

 

Rent payments

32. How are rent levels usually reviewed and are there restrictions on this? Is stamp duty and VAT (or equivalent) payable on rent? Is a rent security deposit required and does it have to be managed in a certain way?

Parties can freely negotiate rent levels. However, any increase cannot exceed the increase in the producer price index for the previous rental term (Code of Obligations).

If the landlord is an individual, he must charge VAT at 20% on the rent. If the landlord is a company, VAT at 18% on the rent applies.

 

Length of term and security of occupation

33. Is there a typical length of lease term and are there restrictions on it? Do tenants of business premises have security of occupation or rights to renew the lease at the end of the contractual lease term?

In general, there is no restriction on the length of lease terms. Leases can be made for definite or indefinite periods. However, the duration of the term affects the stamp duty to be paid by parties, the right to evict the tenant and unilateral termination of the lease.

Lease contracts for a definite term are automatically renewed based on the same terms, unless the tenant notifies the landlord 15 days before the lease termination date that it will move out the premises (Code of Obligations).

The landlord has a limited number of grounds to evict a tenant, unless the tenant violates the lease agreement (see Question 36). However, in the case of a lease contract whose initial lease period has expired and been renewed for ten continuous years, the landlord can decline to renew the lease agreement with a three-month notice to the tenant before the expiry date of the renewed lease term (Code of Obligations (Law 6098)). Under this rule:

  • In the case of contracts whose ten-year continuous renewal term has been reached by 1 July 2012, the right not to renew the lease contract can be exercised starting from 1 July 2014.

  • In the case of contracts whose ten-year continuous renewal term has not been reached by 1 July 2012 and there is less than five years to reach the expiry of this ten year period, the right not to renew the lease contract can be exercised starting from 1 July 2017.

 

Disposal

34. What restrictions typically apply to the disposal of the lease by the tenant? Can the tenant assign or sublet the lease with the landlord's consent? Can tenants share their premises with companies in the same group? What is the effect of a legal reorganisation or transfer/sale of the tenant on the lease and on a guarantee of the lease?

By law, a tenant cannot do the following, unless provided otherwise in the lease:

  • Assign the lease to third parties without the landlord's written consent, provided that the landlord's consent cannot be unreasonably withheld.

  • Sublet the real estate or grant a usage right over the real estate in favour of third parties without the written consent of the landlord.

There is no specific regulation regarding sharing premises with companies in the same corporate group. Therefore, this can be done in practice, as long as the relevant parties agree.

 
35. Does a landlord or tenant retain any liability under the lease after the lease is assigned?

The assignee replaces the tenant when a lease is assigned (Article 323, Code of Obligations). The assignee is responsible as tenant to the landlord and the assignor is discharged from his debts. However, where a commercial lease is assigned, the assignor is mutually responsible to the landlord for two years after assignment.

The tenant can only sub-lease (totally or partly) a residential or commercial real estate or transfer the right of use (totally or partly) of a residential or commercial real estate to a third party if the landlord gives a written consent (Article 322, Code of Obligations). In this case, the tenant is liable to the landlord if the sub-lessee does not use the real estate according to the lease agreement between landlord and lessee.

 

Repair and insurance

36. Who is usually responsible for keeping the leased premises in good repair and for insuring the leased premises? Are there provisions for the ownership of lease improvements?

Unless otherwise agreed, the landlord is responsible for the costs of major repair works. The tenant is only responsible for the cost of repair works related to the ordinary use of the leased premises.

The landlord must provide earthquake insurance according to law. Parties are free to oblige a party to provide certain types of insurance in their lease.

 

Landlord's remedies and termination

37. What remedies are available to a landlord for a breach of the lease by the tenant? On what grounds can the landlord usually terminate the lease and what restrictions and procedures apply? What is the effect of the tenant's insolvency under general contract terms and insolvency legislation?

The landlord can terminate the lease on the following grounds, unless otherwise agreed:

  • Breach of the lease by the tenant.

  • Lack of payment of rent.

  • The need of a new owner for residential use.

  • The need of the owner for residential use.

  • The need to reconstruct or repair the real estate.

  • Bankruptcy of the tenant.

  • Extraordinary circumstances accepted by the relevant court.

If the tenant becomes insolvent after signing a lease, the landlord has the right to demand security for future rent. To do this, a notice is sent to the tenant and its judicial insolvency administrator to provide security in a certain period. If the security has not been given in this period, the landlord then has the right to terminate the lease.

 
38. Can the tenant withhold rent payments in certain circumstances, for example for serious damage to the leased premises? Can the tenant terminate the lease in certain circumstances?

The tenant can unilaterally terminate a lease without a reason, provided that he serves notice of this on the landlord 15 days before the lease term expires (Code of Obligations).

The tenant can also terminate the lease on the following grounds, unless otherwise agreed:

  • Breach of contract by the landlord.

  • Extraordinary circumstances accepted by the relevant court.

 

Planning and development controls

39. In what circumstances can local or state authorities purchase business premises compulsorily? Is the purchase price market value?

Public interest or social utility grounds allow the authorities to acquire real estate through a regulated procedure. Prices are determined by the valuation methods established by law. In some cases they do not reflect the entire value (including potential building rights and future developments), but the value of the land according to current use.

 
40. What authorities regulate planning control and which legislation applies? Is there specific protection for special categories of buildings such as historic buildings?

The city municipalities regulate general planning zones. The local municipalities regulate the application planning zone, which is more detailed.

The Planning Law 3194 is the main legislation applying to planning control. Approved zoning plans are treated as legislation and are mandatory.

The Ministry of Environment and Urban Planning is a government ministry office, responsible for environment and urban planning in Turkey (www.csb.gov.tr).

 
41. What planning consents are required for building works and the use of a building?

A project plan, appropriate to the zoning plan, is submitted to the relevant municipality. If the project plan is approved, a project is submitted to the municipality and a construction licence is obtained if the project is appropriate.

After the construction is finished, a building use permit is granted, provided that the construction is in accordance with the project.

 
42. What are the main authorisation and consultation procedures in relation to planning consents?

Initial consents

The municipalities grant planning consents. Zoning plans are subject to the approval of the municipality council. Usually the council convenes once a month.

Third party rights and appeals

Initial planning consents are announced by municipalities. Any person has the right to object to such consents within 30 days.

A proposed zoning plan must be announced to the public, to notify anyone with an interest and all affected individuals, who can then propose amendments.

After the proposed plan has been made public, persons with an interest can object to the planning decision. The objection is discussed within 15 days at the municipality council and a decision is given. If the objection is dismissed by the municipality, the decision can be appealed to administrative courts.

 
43. Are there proposals to reform real estate law and are they likely to come into force and, if so, when?

Parliament is currently working on a new Planning Law. However, we cannot currently estimate when it will be in force.

 

Online resources

General Directorate of Development of Legislation and Publication

W www.mevzuat.gov.tr

Description. The official website where all legislation can be obtained. It is up-to-date and available in Turkish only.



Contributor profiles

Gökmen Başpınar, Founder Partner

Başpinar & Partners

T +90 212 465 6699
F +90 212 465 3699
E gokmen.baspinar@baspinar.av.tr
W www.baspinar.av.tr

Professional qualifications. Advocate, Turkey

Areas of practice. Real estate; arbitration.

Languages. Turkish, English

Aytuğ Büyükatak, Associate

Başpinar & Partners

T +90 212 465 6699
F +90 212 465 3699
E aytug.buyukatak@baspinar.av.tr
W www.baspinar.av.tr

Professional qualifications. Advocate, Turkey

Areas of practice. Real estate; corporate.

Languages. Turkish, English, Dutch


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