GERMANY Law and Practice Contributed by: Wolfram H. Krüger, Barbara Rybka, Markus Wollenhaupt and Alexander Zitzl, Linklaters
4.6 Agreements With Local or Governmental Authorities
• the development plan for the entire territory of the municipality ( Flächennutzungsplan ), which lays down the main features of the various types of land use that will be permitted on the basis of intended urban development and the anticipated needs of the municipality, eg, areas earmarked for development, transport, public infrastructure, green spaces, etc; and • a detailed plan for individual areas within the municipality ( Bebauungsplan ), which des - ignates the permitted land use and usually refers to the Federal Land Use Ordinance, giving a detailed description of the building areas (eg, residential, industrial, retail or busi - ness) and restrictions on the size, height and floor area of permissible buildings. 4.4 Obtaining Entitlements to Develop a New Project In order to obtain entitlements to develop a new project or complete a major refurbishment, an application specifying the planned construction work and the use of the land must be submitted. The responsible authorities will then forward the application to any other authority with potential interest in the planned project. The responsible authority itself verifies whether the project complies with planning law. If it does, and if no relevant concerns are raised by the oth - er authorities involved, the responsible authority
Arrangements known as urban development agreements can be entered into between build - ing owners or developers and the relevant municipality. In these contracts, the municipality undertakes to support the building owner/devel - oper, or the building owner/developer under - takes to support the municipality in its planning goals. 4.7 Enforcement of Restrictions on Development and Designated Use If a building is not built or used in line with the issued building permit, the competent authority has the right to prohibit the use or – in a worst- case scenario – request the deconstruction of the building. The authority is obliged to exercise reasonable discretion (ie, it must adhere to the principle of proportionality). This means, if there is any way to grant a building permit to cover the actual building or use, it must be granted (after the usual application process) instead of a deconstruction order. 5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets Generally speaking, any entity, including for - eign entities, that has legal capacity can hold real estate in Germany, unless prohibited by law or court or administrative order. Limited liabil - ity companies (GmbH) and limited partnerships (KG) are most commonly used to acquire and hold real estate. German law also recognises real estate invest - ment trusts (REITs), which are listed real estate stock companies. However, there are only five REITs listed in Germany.
must grant the building permission. 4.5 Right of Appeal Against an Authority’s Decision
Legal action can be taken against the relevant authority’s decision to refuse planning permis - sion. Third parties, such as neighbours, can commence proceedings against the issuance of a building permit if they can prove that the decision may unlawfully affect their rights.
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