Real Estate updates

Austria

Contributed by Graf & Pitkowitz Rechtsanwälte GmbH
Demolition crackdown: Vienna protects its buildings
  • Austria
  • 31 August 2018

The City of Vienna recently announced its intention to reform the building code. Some building owners consider it unfair that strict maintenance obligations and rent limits apply only to old buildings, whereas buildings constructed after 8 May 1945 can be let at market rent. As a result, many building owners have chosen to tear down historic buildings and erect new concrete and steel structures in their place. Therefore, one of the aims of the reform is to protect the city's historic buildings.

Supreme Court manages shopping centre management costs
  • Austria
  • 08 June 2018

Service charge provisions in shopping centre lease agreements frequently give rise to disputes between landlords and shop operators. In a recent decision on such costs, the Supreme Court offered some insights into shopping centre lease agreements which go beyond service charge provisions.

Supreme Court: no change of control despite departure of majority shareholder
  • Austria
  • 09 March 2018

The Supreme Court recently considered whether a landlord can increase the rent if the majority shareholder of a partnership dies and his or her shares are distributed equally among the remaining partners, none of whom holds a majority in the partnership. In the decision, the Supreme Court offered an insight into how to assess the change of control in a company that is not a corporation.

Parliament stomps on stamp duty for residential leases
  • Austria
  • 24 November 2017

In the run up to the recent snap elections, Parliament passed a bill exempting rent agreements for residential leases from stamp duty. The stamp duty on non-residential leases – in particular, commercial and retail leases – remains unchanged. However, these leases are being re-evaluated due to recent case law from the tax authorities.

Another brick in the wall: Constitutional Court reviews statutory rent regulations
  • Austria
  • 18 August 2017

In 2015 Austria introduced an act which allows individuals, under certain conditions, to challenge laws before the Constitutional Court as unconstitutional. This gave hope to many landlords, which saw this as a tool to challenge the existing rent control regulations. The Constitutional Court recently handed down two new decisions on the same matter with surprising results.


Cyprus

Contributed by George Z Georgiou & Associates LLC
Rent control court rules on outstanding rent
  • Cyprus
  • 14 December 2018

The Nicosia Rent Control Court recently ruled on the outstanding rent of a statutory tenant. The court held that a provision for the increase of rent provided for in a tenancy agreement does not apply once the tenancy is converted into a statutory tenancy. However, by interpreting the terms of the tenancy agreement (which had been terminated in this case), the court concluded that it had not provided for an increase in rent during the first tenancy period.

Amendments to Transfer and Mortgage of Immovable Property Law introduced
  • Cyprus
  • 05 October 2018

Law 8(I)/2018 came into force in July 2018, amending the Transfer and Mortgage of Immovable Property Law. The new legislation was applied for the first time in a recent Nicosia District Court case, which is considered to be of great importance in assessing how the courts will interpret the new law in future. The case concerned an auction procedure which had been initiated by the sending of the relevant documents and notices to the mortgagor, which filed a lawsuit against Hellenic Bank to suspend a foreclosure procedure.


Georgia

Constitutional Court sets out new standard for purchase of real estate in Georgia
  • Georgia
  • 09 February 2018

The Constitutional Court recently considered issues raised in the decision of a lower court in which the legal presumption of accuracy and completeness of entries in the Public Register in relation to real estate was declared in part unconstitutional. The decision may have a significant, adverse impact on the real estate market in Georgia and will be relevant to any real estate transaction, including taking mortgage security.


Germany

Contributed by Noerr LLP
Formal requirements on agreements to amend real estate purchase contracts after conveyance
  • Germany
  • 16 November 2018

Federal Court of Justice case law suggests that the parties to a real estate purchase contract can in principle immediately change its content without having to comply with notarial form requirements after the notarial certification of the real estate purchase contract containing the conveyance has been concluded. The court's recent decision in this regard is to be welcomed in the interests of the continuity of its case law and in view of the lower courts' increasingly inconsistent case law in the past.

New RETT rules for share deals
  • Germany
  • 06 July 2018

The Ministers of Finance of the Federal States recently agreed on new real estate transfer tax (RETT) rules for share deals. According to official press releases, a fundamental RETT reform that had been previously discussed was not agreed. Rather, the agreement consists of new RETT rules regarding share deals with a lower threshold, longer holding periods and aligning the rules that are applicable to corporations with those that already apply to partnerships.

Sale of real estate by special purpose vehicles
  • Germany
  • 20 April 2018

Transaction structures involving special purpose vehicles, whose main assets after completion of the purchase process consist only of the purchased real estate, are often chosen in Germany. Such structures are used in particular to shield from liability, so that third-party access to the special purpose vehicle's assets is limited. They are also used to facilitate a sale without incurring real property transfer tax for the exit.

Impending terminability of land use agreements for energy plants
  • Germany
  • 08 December 2017

The operation of energy plants usually means securing the required land long term by way of a use agreement. Prematurely ending a use agreement can substantially reduce the profitability of investments in energy plants. Defects in the written form of use agreements therefore constitute a risk for such investments. However, the Federal Court of Justice has decided that written form remedy clauses are invalid and do not prevent a contracting party from terminating a use agreement by invoking a written form defect.

Rental agreement termination for landlord's own use – new case law
  • Germany
  • 16 June 2017

A landlord can terminate a rental agreement for residential premises if he or she has a justified interest in ending the lease. Two recent Federal Court of Justice decisions provide clarification regarding a landlord's needs as grounds for termination. While the change in case law regarding the legal consequences of a breach of the duty to offer is welcome, the judgments also show that there is no one-size-fits-all answer to the question of whether termination due to a landlord's needs can be declared valid.


Guernsey

Plans for Guernsey deposit protection scheme to be laid out before end of 2018
  • Guernsey
  • 05 October 2018

The Office for the Environment and Infrastructure recently announced that a new deposit protection scheme will be planned before the end of 2018. The announcement follows news that a local estate agent has ceased trading, leaving some tenants and landlords uncertain of their position with regard to rents and deposits that were being held by that agent. The proposal is likely to be that Guernsey should introduce a similar, if not identical, scheme to that already in place in Jersey.