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The Buenos Aires government plans to suspend new housing projects: Strong criticism from the private sector - Infobae
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El gobierno porteño planea suspender los nuevos proyectos inmobiliarios para viviendas: fuertes críticas del sector privado
La medida, que se espera se oficialice mañana viernes, tendría vigencia hasta inicios de 2025, a la espera de cambios en el Código Urbanístico que Jorge Macri envió a la Legislatura. Desarrolladores y constructores se mostraron en contra
www.infobae.com
August 8, 2024
The measure, which is expected to be made official tomorrow, would be valid until the beginning of 2025, pending changes to the Urban Planning Code that Jorge Macri sent to the Legislature. Developers and builders were against it
By Jose Luis Cieri
The measure will be in effect until the Buenos Aires Legislature defines the changes that will be applied to the Urban Code for new buildings in CABA
The Buenos Aires City government is preparing to suspend the start of new housing construction throughout the city until early 2025. This is detailed in the draft decree accessed by Infobae , which will be published in the Buenos Aires Official Gazette tomorrow, Friday, according to official sources.
The measure caused a strong impact and was criticized by the private sector, which warned of the potential hindrance to real estate development and the possibility of several companies going bankrupt.
This decision by the administration headed by Jorge Macri is due to the need to adjust the Urban Planning Code (CUR) established in Law 6099/18 ( which stipulates a review of the code every four years ), whose draft amendments have already been submitted to the Buenos Aires Legislature, which must discuss it and decide whether to approve the initiative or the reform.
“They are supposedly trying to prevent developments from being approved in these months with the old code, until the new one comes out. In the meantime, they are clearly putting a stop to one of the driving forces of the economy,” said an important player in the sector. “It is also true that there is pressure from residents, especially from neighborhoods like Villa del Parque, where there are many problems with power shortages and clogged sewers. The infrastructure is tied up with wires,” he added.
Sources from the Buenos Aires City government reported that the measure, which will last 180 days or until the modification of the CUR is approved, aims to protect the identity of each neighborhood and ensure that new constructions are aligned with the regulations in the process of being updated.
The decree halts the issuance of new Urban Certificates, necessary to begin construction, and also suspends extensions for projects in Low Altitude Sustainability Units (USAB) 1 and 2. However, procedures already initiated will not be affected, since the DNU is not retroactive.
The suspension also includes the suspension of urban planning interpretation consultations and the registration of new projects in the development phase, unless they meet strict criteria, such as a maximum height of 9 metres. These areas, called USAB, are low-rise residential zones, designed to preserve the neighbourhood character of the city.
Modifications to the CUR
The criteria that will guide the modifications seek an adjustment to the CUR and these are led by the Secretariat of Urban Development, headed by Álvaro García Resta .Restrictions in the decree include:
- Prohibition of initiating a consultation process for new works throughout CABA.
- Prohibition of starting a registry of new constructions of up to 4 floors throughout CABA.
- Cancellation of ongoing consultation files for constructions of up to 4 floors.
The procedures for consultations and urban planning certificates, used in land sale negotiation processes, require a lower level of technical file preparation.
The aim is to lower the height of buildings in the neighbourhoods and to build towers mainly on avenues where buildings can be built.
Instead, registrations are used when a complete technical file has been compiled, a process that takes approximately three months. The suspension affects those who have already purchased land and are in the process of preparing the file, interrupting their ability to begin the registration and, subsequently, the work.
The new Code proposes measures to safeguard neighbourhood identity, limit building heights in residential areas and promote urban sustainability. Large developments may only be carried out on avenues with adequate infrastructure, and the creation of more permeable spaces within blocks will be encouraged.
This reform also seeks to revitalize neighborhood shopping centers and encourage development in the southern part of the city through a system of incentives.
Rejection of builders
The suspension of the submission of new housing construction projects has generated strong rejection in the construction sector.“Several developers and builders fear that, by not being able to start construction within the planned time frame, they will lose the right to build under the conditions under which they bought the land, significantly reducing development capacity and severely affecting their financial viability,” said Santiago Levrio , institutional director of Alianza Urbana, an entity that brings together hundreds of SMEs that develop buildings.
Gonzalo Bustos , from Fot Libre, pointed out that another of the important modifications is the heritage protection of buildings. A total of 4,209 buildings that currently have preventive protection will now have protection under a firm law, which implies greater restrictions for any type of modification or demolition of these buildings. “In addition, heritage protection is accompanied by the modification of building and use plans, reducing the permitted height and limiting uses in most of the city's neighborhoods, greatly affecting Villa Devoto, Chacarita, Urquiza, Almagro and Palermo SoHo,” Bustos said.
The major bans focus on reducing permitted heights and limiting uses in the affected areas. This creates a new scenario for developers, especially those working on a small scale.
Bustos explained that whenever there are modifications to the code, greater uncertainty is generated throughout the industry. This happened with the modifications of December 2020 and September 2022. In this case, the change in regulations mainly affects medium and small developers.
This new Urban Planning Code will also impact ongoing projects, as several files for consultations on constructions up to 4 floors will be cancelled. These procedures, used in negotiations for the sale of land, require a lower level of preparation of technical files, so their interruption directly impacts those who have already purchased land and are in the process of preparing the file.
“The draft adjustment to the CUR fails to establish a clear model for urban development, overlooking the sustainability and accessibility that nearby cities offer. We criticize the prohibition of building outside avenues, favoring large developments over small buildings, which could negatively affect the sector and prevent reinvestment in the city,” Levrio concluded.
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