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 multi-jurisdictional guide to corporate real estate law. For a full list of jurisdictional Q&As visit

Gökmen Başpınar, Baspinar & Partners

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.

After the law adopted in 2012, removing the reciprocity rule and allowing 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. Since 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.

One of the largest deals in the last 12 months in the real estate market was the third airport tender. The Cengiz-Kolin-Limak-Mapa-Kalyon Consortium, a joint venture of Turkish companies, won the tender for the third airport in Istanbul, promising to pay the government a total of EUR22.1 billion over 25 years, starting from 2017. The tender is a build-operate-transfer project, to be conducted in four stages. The state will guarantee the amount of passengers and tariff levels for a certain amount of time. Once the construction is complete, the airport will have the highest passenger capacity in Turkey, at 150 million passengers.

Other completed transactions included the acquisition by GIC of 50% of two shopping centres, Optimum Göztepe in Istanbul and Optimum Ankara, with a reported asset value of EUR181 million and US$165 million, owned by Rönesans.

The sale of Meydan Ümraniye was also a notable transaction, worth EUR140 million plus VAT. This shopping centre was acquired by Gülaylar Group, a major jewellery retailer in Turkey. The group also owns Nişantaşı City's Shopping Centre in Istanbul.

Investor interest in the office market remains strong. Notable deals included the following:

  • The acquisition of a 20,000 square metre office building in Metropol Istanbul, a major mixed use development in Ataşehir, by Eren Holding.

  • Mapfre acquired about 10,000 square metres in Torun Centre, for a mixed use development including two 42 storey residential towers and a 36 storey office tower, on the site formerly used as Ali Sami Yen Stadium.

The sale of Adam and Eve, Hillside Su and Kemer Resort in Antalya were among the notable hotel sale transactions.


Real estate investment

2. How is real estate investment carried out in your jurisdiction and what structures do investors use?

Common structures

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.

Institutional investors

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

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.


Real estate legislation

3. What is the main real estate legislation that applies in your jurisdiction?

The main real estate legislation in Turkey is the Law of Title Deed. Other legislation applies, including the:

  • Civil Code.

  • Zoning law.

  • Condominium law.

  • Cadastral law.


Title to real estate

Title and registers

4. 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 instance:

  • 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.

Evidencing title

5. How is title to real estate evidenced?

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). Each district has a separate land register.

Information in the public register

6. What are the main information and documents registered 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.

Protection from disclosure

7. Can confidential information or documents be protected from disclosure in the public register of title?

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.

State guarantee of title

8. Is there a state guarantee of title? Is title insurance available? If so, 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 exist)?

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

Main stages and documents

10. What are the main stages and documents in the sale of real estate?


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.

Commercial negotiation

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

Pre-contractual arrangements

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

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

When legally binding

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


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.

When title transfers

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

Seller's liability to the buyer

11. 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 instance, 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 inappropriate architectural design of the building.

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

Due diligence

12. What real estate due diligence is typically carried out before an acquisition?

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?

The sale contract is signed at the land register at the same time as the title transfer is registered (see Question 10, Registration). 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.

Inheriting liability

14. Can an owner or occupier inherit liability for matters relating to the real estate even if they occurred before it bought or occupied 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.

Retention of liability after disposal

15. Does a seller or occupier retain any liabilities relating to the real estate after it has disposed of it?

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

Seller and buyer costs

16. What costs are usually paid by the buyer? What costs are usually paid by the seller?

Buyer's costs

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.

Seller's costs

The seller pays a real estate sale fee of 2% of the declared value of the real estate (see above, Buyer's costs).


Real estate taxes and mitigation

17. Is value added tax (VAT) (or equivalent) payable on the sale or purchase of real estate?

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%.

  • At least TRY1,000 per square metre: 18%.

18. Is stamp duty/transfer tax (or equivalent) payable on the sale or purchase and who pays?

Both buyer and seller pay 2% of the declared value of the land as real estate transfer tax (see Question 16).

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 (see Question 10).

However, stamp duty at 0.94% 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?

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.


Holding business premises

Climate change targets

20. Are there targets 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.

Third party outsourcing

21. Is it common for companies to manage their real estate portfolios and their accommodation needs by using third parties through outsourcing transactions?

Companies usually receive asset management and facilities services from third parties when required.

Restrictions on foreign ownership or occupation

22. Are there restrictions on foreign ownership or occupation of real estate, or on foreign guarantees or security for ownership or occupation?

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 which 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.

Issues on change of control

23. Does change of control of a company affect its holdings of real estate?

A change of control of company does not generally affect its holdings of real estate.

In certain circumstances, a new foreign shareholder must inform the relevant government authorities if a Turkish company holding real estate becomes foreign owned (see Question 22).

Compulsory purchases

24. 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.

Municipal taxes

25. 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.


Real estate finance

26. How are acquisitions of large real estate portfolios or companies holding real estate generally financed?

Large real estate acquisitions, whether direct or through a share deal, are generally financed by a combination of equity and banking finance.

27. How is real estate commonly used to raise finance?

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

28. What are the most common forms of security granted over real estate to raise finance? How are they 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.

29. Is real estate securitisation common in your jurisdiction?

Real estate securitisation is not common in Turkey.


Real estate leases

Negotiation and execution of leases

30. Are contractual lease provisions regulated or freely negotiable?

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?

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

Rent levels and reviews

32. How are rent levels usually reviewed and are there restrictions on this? Is VAT (or equivalent) payable on rent?

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 leave the premises (Code of Obligations).

The new Code of Obligations will introduce several new regulations regarding the lease term. However, they will be not in force until 2020.

Restrictions on disposal

34. What restrictions typically apply to the disposal of the lease by the tenant?

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.

Use of premises within a corporate group

35. Can tenants usually share their business premises with companies in the same corporate group?

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.

Repair and insurance responsibilities

36. Who is usually responsible for keeping the leased premises in good repair?

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.

37. Who is usually responsible for insuring 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.

Grounds for termination

38. On what grounds can the landlord usually terminate the lease? Can the tenant terminate the lease in certain circumstances?


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.


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.

Tenant's insolvency

39. What is the effect of the tenant's insolvency under general contract terms and insolvency legislation?

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.


Planning law

40. What authorities regulate planning control and which legislation applies?

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.

41. What planning consents are required and for which types of development?

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.

Third party rights

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

Public inquiries

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.

Initial decision

Zoning plans are subject to the approval of the municipality council. Usually the council convenes once a month.


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 any proposals to reform real estate law in your jurisdiction?

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


Real estate organisations

General Directorate of Land Registry and Cadastre

Main activities. This is a public institution responsible for keeping the land registers, and co-ordinating cadastre activities.


Ministry of Environment and Urban Planning

Main activities. This is a government ministry office, responsible for environment and urban planning in Turkey.


Online resources

General Directorate of Development of Legislation and Publication


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

Contributor profile

Gökmen Başpınar, Founder Partner

Başpinar & Partners

T +90 212 465 66 99
F +90 212 465 36 99

Professional qualifications. Advocate, Turkey.

Areas of practice. Real estate; arbitration.

Languages. Turkish, English

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