The regeneration deal: Developers, homeowners and new competencies in the development process

Market-oriented housing regeneration policies rely on private entrepreneurs for implementation. As these policies proliferate globally, they increasingly bring developers in direct contact with residents from diverse tenure groups, including homeowners. Building on institutional analysis of developer behavior, we explore the variegated roles and competencies that developers assume and employ in their interaction with homeowners. Raze and Rebuild - a national housing redevelopment program in Israel - serves as the case for analysis. The program presents developers with the opportunity to capitalize on valuable urban land, but also carries a risk that stems from the need to strike a complex deal with multiple and diverse homeowners. Based on interviews, observations, and analysis of shareholder reports, title deeds and media articles, this paper explores the ways in which developers attempt to mitigate and manage this risk. We identify three major approaches to reaching the regeneration deal-a contractual agreement between developers and homeowners. The deal requires developers to acquire new competencies such as organizing homeowners, building trust via interpersonal relationships, and maintaining a strong local presence. The three resultant approaches differ in the way the risk components are distributed between various actors, namely between developers and newcomer intermediaries. The new roles of developers are found to be crucial in implementing the regeneration of homeowner communities, as they motivate homeowners to act collectively towards rent-maximizing.