Legal Guide on Urban Transformation Requirements and the "Half on Us" Campaign

The fact that Turkey is located on an active seismic belt renders the rapid renewal of old and vulnerable building stocks a statutory necessity. Law No. 6306 on the Transformation of Areas Under Disaster Risk, which forms the legal foundation of this renewal process, stands as the most critical legislation balancing private property rights and public safety. Recently, the questions surrounding the "Half on Us" Campaign (Yarısı Bizden Kampanyası) and the statutory urban transformation requirements have fundamentally reshaped the legal relationships between land owners and contractors.

Urban transformation processes are subject to highly meticulous procedural rules—spanning from risky building assessment objection mechanisms to kentsel dönüşüm contractor agreements and temporary rent subsidy allocations. In this comprehensive guide, Malgır Law Firm deconstructs step-by-step the statutory paths that rightful owners must pursue, state subsidy mechanisms, and dispute resolution methods under the light of Law No. 6306 and its matching Implementing Regulation.

What are the Urban Transformation Requirements Under Law No. 6306?

The primary objective of urban transformation is to establish healthy and safe living environments in areas under disaster risk, as well as on lands where risky structures outside these designated areas are located. To achieve this objective, the legislature has granted the power to execute specific interventions over private property rights to the Ministry of Environment, Urbanization, and Climate Change, relevant local administrations, and the Directorate of Urban Transformation (Kentsel Dönüşüm Başkanlığı), which serves as the supreme administrative authority executing transformation projects directly in the field.

For a real property to be transformed within the scope of Law No. 6306, it must primarily be granted the status of a "risky building" or a "risky area." A risky building (riskli yapı) denotes a structure that has completed its economic lifespan, or is technically and scientifically verified via empirical data to carry a severe risk of collapse or heavy damage. Securing this official determination is the condition precedent to benefiting from the statutory advantages offered by the law, such as rent subsidies and tax/fee exemptions.

Primary Statutory Exemptions Granted Under the Law:

• Exemptions are fully granted from notary fees, land registry and cadastre fees, and specific administrative fees collected by municipalities.

• Transactions are strictly exempted from stamp duty and inheritance/transfer taxes regarding all contracts and papers drafted within this scope.

• Where the implementation is executed by natural persons or private law legal entities, no municipal fees or charges shall be collected for the newly constructed area up to one and a half times ($1.5\times$) the pre-existing construction area, regardless of any zoning function modifications.

What is the Directorate of Urban Transformation and What are its Duties?

The Directorate of Urban Transformation, which frequently appears in our practice and across urban transformation applications, is an authorized administrative organ with an independent budget. It personally executes, supervises, and organizes urban transformation processes, risky areas, reserve building areas, risky structure determinations, as well as demolition, zoning, and transformation projects nationwide.

Pursuant to the Law and the Implementing Regulation, the Directorate of Urban Transformation is fully vested with the authority to audit risky building assessment reports, license urban transformation consultancy and negotiation firms, serve default notices for the ex-officio rescission of contracts, and execute the evacuation and demolition of risky buildings ex-officio through law enforcement forces via local civil authorities. Final administrative decrees, grants, and credit approvals in urban transformation processes are resolved exclusively within this Directorate.

How is a Risky Building Assessment Executed and What are the Objection Mechanisms?

The most critical phase of the transformation timeline is the technical and legal finalization of whether a structure is risky. The determination of risky buildings is primarily executed by the property owners or their legal representatives, with the relevant expenditures borne by themselves. This technical assessment is conducted by specialized institutions and organizations licensed directly by the Directorate of Urban Transformation.

The Assessment Timeline and Risky Building Objection Mechanisms Move Forward Through the Following Steps:

[Technical Assessment by Licensed Body] 
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[Notification to Land Registry (Within 10 Days)] 
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[Physical Vetting Notice Hung on Structure + e-Devlet Notice] 
                  │
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[Official Announcement at Local Mukhtar's Office (15 Days)] 
                  │
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[Statutory Window to File Formal Objection (15 Days)] 
                  │
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[Final Binding Decision by the 7-Member Technical Committee]

• Assessment and Land Registry Record: Structures verified as risky are notified to the relevant land registry directorate by the Directorate of Urban Transformation or the local Administration within ten business days at the latest, and an official blocking annotation is recorded into the declarations column of the land register.

• Notification and Announcement Process: Serving as a substitute for personal service to the property owners; the assessment minutes are physically hung upon the structure, a digital notice is delivered to owners via the e-Government (e-Devlet) gateway, and the notification is officially announced at the local mukhtar’s (muhtarlık) office for a strict duration of fifteen days.

• The Right to Object: A formal objection can be filed via a written petition to the Directorate of Urban Transformation at the venue where the property is located, or to the authorized local Administration within fifteen days commencing from the final day of the announcement at the mukhtar’s office.

• Vetting of the Objection: These objections are reviewed and definitively resolved by a seven-member technical committee, which is established with the participation of four academic faculty members assigned by universities and three specialized officials serving within the organizational structure of the Directorate.

In the event that the objection against the risky building assessment is rejected, or if no objection is filed within the statutory timeframe, the risky building determination becomes final and absolute. At this stage, owners are granted a definitive timeframe, not exceeding ninety days, to fully evacuate and demolish the structure.

What is the "Half on Us" Campaign? (Grants and Subsidized Credit Supports)

Launched to facilitate citizens' access to earthquake-safe housing, the "Half on Us" Campaign is a state-sponsored support model aimed at covering a substantial portion of construction costs through direct government grants and low-interest subsidized credits. Within the scope of urban transformation requirements, property owners wishing to renew their vulnerable structures utilize this campaign to mitigate their financial burdens.

Pursuant to Law No. 6306, financial construction aid can fully be provided to owners, tenants, and limited real right holders (sınırlı ayni hak sahipleri) who evacuate structures by mutual agreement, on the condition that they actively reside in the property. The procedures, principles, grant amounts, and credit pipelines of this construction aid are determined directly by the President. Campaign approvals and grant distributions are administered under the coordination of the Directorate of Urban Transformation through the specialized urban transformation projects account.

Rent Subsidies and Relocation Allowances

Remedying the housing requirements of citizens who evacuate their properties during urban transformation is a statutory obligation. Rightful owners in structures evacuated by mutual agreement can be granted a monthly rent subsidy starting from the evacuation or demolition date.

Mandatory Statutory Rules Governing Rent Subsidies:

• Durations: The subsidy duration is 18 months for risky buildings located outside designated risky areas. In risky areas and reserve building areas, the rent subsidy duration is determined by the relevant institution, provided it does not exceed a maximum cap of 48 months.

• Tenants and Limited Real Right Holders: Natural or legal persons residing or operating a commercial business as tenants in the structure can be granted a one-time, lump-sum (defaten) rent subsidy equal to twice the designated monthly rent rate. For limited real right holders, a lump-sum subsidy equal to five times the monthly rate is paid.

• The Interest Support Alternative: Interest rate subsidies can be provided from the specialized transformation projects account for urban transformation loans obtained from commercial banks. However, a person cannot utilize both rent subsidy and interest support concurrently; a choice must be made to benefit from only one of these options.

The Absolute Majority Rule and the Public Auction of Minority Shares

The historic two-thirds ($2/3$) majority rule, which frequently bottlenecked the execution of kentsel dönüşüm contractor agreements in the past, has been updated to an "Absolute Majority" (Salt Çoğunluk) rule via a strategic amendment to Law No. 6306, aiming to accelerate urban transformation while protecting public safety.

Pursuant to the contemporary statutory regulation; both before and after the demolition of risky buildings, decisions regarding the re-evaluation, construction methods, and allocation of the parcels via construction contracts in return for land share (kat karşılığı) or revenue-sharing (hasılat paylaşımı) methods are enacted by the absolute majority (50% + 1) of the co-owners in proportion to their registered land shares, completely regardless of whether they participate in the actual project development.

During this statutory process, the land shares of minority owners who refuse to participate in the absolute majority resolution are subjected to the following compulsory legal transactions:

1. The formal offer, containing the enacted resolution and the specific terms of the contract, is notified to the dissenting owners through a notary public, or via an official announcement displayed at the mukhtar’s office for a duration of fifteen days.

2. If the offer is not accepted within fifteen days commencing from the notification date, the land shares of the dissenting minority are sold via a public auction to the other consenting co-owners of the parcel, at a price that cannot be less than the fair market value (rayiç değer) determined by the Directorate of Urban Transformation.

3. If a sale to the existing co-owners cannot be achieved, the public auction process is systematically repeated until the minority shares are sold to third parties who formally agree to execute the transactions in absolute alignment with the majority agreement.

Default of the Contractor and the Ex-Officio Rescission of Contracts

One of the most frequent uyuşmazlıklar in urban transformation applications involves construction firms failing to perform their corporate commitments on time (falling into default). To prevent severe grievances, construction agreements executed between rightful owners and contractors can, under specific statutory conditions, be dissolved ex-officio via administrative channels.

Pursuant to the Law and the Implementing Regulation, for a contract to be rescinded administrative-wise, a resolution must be enacted by the absolute majority of the co-owners in proportion to their land shares, and one of the following two statutory conditions must materialize:

Statutory Ground for RescissionRequired Parameters and TimeframeFailure to Commence Construction WorkFollowing the execution of the contract with the co-owners, the contractor fails to commence the actual construction of the new building within 1 year due to reasons attributable to their own operations.Suspension of Construction OperationsThe construction operations are halted at a specific physical level, and no active construction activity has been executed for at least 6 months with a level of workforce and equipment required to complete the project.

Where these technical grounds manifest, the owners apply to the Directorate of Urban Transformation or the competent local Administration to request a formal verification of the site. If the investigation confirms the owners' claims, a default notice is served upon the contractor, granting a final grace period of thirty days.

If the contractor fails to commence or resume construction despite this official notice, the contracts are deemed automatically rescinded ex-officio (resen feshedilmiş sayılır) as of the expiration date of the thirty-day window, without requiring the consent or signature of the contractor. Furthermore, any rent subsidy payments executed by the contractor to the rightful owners up to the date of rescission cannot legally be claimed back by the defaulting contractor.

Conclusion

The urban transformation process is a highly technical and procedural sequence that directly impacts the property rights of land owners and can yield irreversible legal consequences. Securing professional legal representation is the solitary path to preventing severe forfeitures of rights, both during procedural objections against risky building assessments and throughout the drafting, monitoring, and rescission phases of construction contracts executed with contractors.

Operating from our primary centers in Ankara, Mersin, and Gaziantep, the expert legal team at Malgır Law Firm provides comprehensive criminal/civil advocacy and strategic administrative consultancy across Turkey, expertly managing urban transformation contract tencere, default mechanisms, and matching land title litigation to safeguard our clients' constitutional and statutory property rights.