Pre-emptive purchase rights ruled illegal

Newsletter Posts / Berlin - News

In a sensational ruling, the Federal Administrative Court has quashed Berlin’s policy of pre-emptive purchase. According to the Court, the assumption that the sale of an multi-family property in a designated neighbourhood protection area after the stipulated seven-year period could lead to the displacement of tenants does not provide sufficient justification for Berlin’s building authorities to exercise their pre-emptive purchase rights. The new judgement is a clear victory for many property owners in Berlin. In addition, many of the Abwendungsvereinbarungen (“aversion agreements”) concluded between district authorities and property owners will now also be subject to scrutiny. The ruling will have two consequences: In the short term, authorities will make less frequent use of their pre-emptive purchase rights. In the long term, federal lawmakers are likely to revise the existing legislation and will probably even strengthen municipalities’ rights of first refusal.

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