ARU and ORU Zone – Benefits for urban rehabilitation

Urban rehabilitation is fundamental for the revitalization of urban areas and the preservation of the cities’ architectural and cultural heritage. In many countries, Urban Rehabilitation Zones, known as ARU Zones, have played a crucial role in supporting requalification and rehabilitation projects for old buildings. This article explores the benefits of the ARU Zone for both builders and owners, highlighting its positive impact on improving the quality of life in cities and conserving their urban fabric.

Brief overview

The delimitation of Urban Rehabilitation Areas (ARU) and the respective Urban Rehabilitation Operations (ORU), whether simple or systematic, are framed by the Urban Rehabilitation Legal Regime (RJRU), approved by Decree-Law No. 307/2009, of October 23, in its current wording.

According to this diploma, urban rehabilitation is defined as a form of integrated intervention on the existing urban fabric, in which the urban and real estate heritage is maintained, in whole or in a substantial part, and modernized through the carrying out of remodeling or improvement works. urban infrastructure systems, equipment and urban or green spaces for collective use and construction, reconstruction, expansion, alteration, conservation or demolition of buildings.

This is a broad concept – which transcends the requalification of buildings – in which several interests and objectives converge, such as the rehabilitation of heritage buildings, the urban rehabilitation of infrastructures and public spaces, as well as the rehabilitation of the economic and social fabric itself. The delimitation of the ARU and approval of the ORU is the responsibility of the Municipal Assembly, upon proposal from the City Council.

The proposal for delimiting an urban rehabilitation area must include:

1. The descriptive and justifying memory, which includes the criteria underlying the delimitation of the covered area and the strategic objectives to be pursued;
2. The plan with the delimitation of the covered area;
3. The framework of tax benefits associated with municipal taxes.

The ORU execution project must contain the strategic urban rehabilitation program, with the definition of the managing entity, execution deadline, model and investment program.

Benefits to achieve

In recent years (since 2009), legislation on Urban Rehabilitation has been reinforced, giving high priority to the integrated intervention of the rehabilitation of the existing urban fabric, leading to the delimitation of Urban Rehabilitation Areas that correspond to strategic choices of the areas where it is primarily important to intervene.

• Enhance/implement/enable the application/implementation of national policies/measures/guidelines/standards to the Municipality;
• Enhance the urban consolidation of the surroundings of the city’s Historic Center, through urban regeneration;
• Develop and consolidate the city’s urban experience, through the requalification of green spaces, urban spaces and equipment for collective use, enhancing a part of this territory that is part of the Ecological Structure;
• Promote urban quality through the functional integration and economic diversity of the urban fabric;

In fact, the future elaboration of the Strategic Urban Rehabilitation Program’s main aim is to accelerate the dynamics of the urban regeneration market, in the consolidation of the municipal policy for the elaboration of ARU, enhancing private participation through tax exemptions, the reduction of municipal taxes, attract investors and boost construction activity, as well as boost local commerce and tourism, meaning this process cannot be carried out without the active and financial participation of individuals, from a perspective of process sustainability.

Incentives for urban rehabilitation

At a national level, in recent years, additional instruments have been created to stimulate urban rehabilitation operations, aiming to create support and incentives for individuals, namely:

Value added tax (VAT)
Reduction of VAT from 23% to 6%, in “urban rehabilitation contracts, carried out in properties or public spaces located in ARU, or within the scope of requalification and rehabilitation of recognized national public interest”;

Municipal property tax (IMI)
Urban buildings subject to rehabilitation are exempt from IMI for a period of three years counting from the year inclusive of the issuance of the respective council license (article 44 of the EBF), and may be renewed, at the owner’s request, for a further five years in the case of properties used for renting for permanent housing or for own permanent housing;

Onerous property transfers (IMT)
– Exemption from IMT on acquisitions of properties intended for rehabilitation interventions , as long as the purchaser initiates the respective works within a maximum period of three years from the date of acquisition;
– Exemption from IMT on the first transmission, subsequent to the rehabilitation intervention, affecting rental for permanent housing or, when located in an urban rehabilitation area, also for permanent housing.

In accordance with the provisions of article 16 of the Financial Regime for Local Authorities, the exceptional regime defined for ARU, and specifically the benefits associated with IMI and IMT, depends on deliberation by the Municipal Assembly. At municipal level, municipalities may consider expanding the urban rehabilitation incentive policy, rewarding property owners who carry out rehabilitation works on their heritage, thus introducing positive discrimination.

If you need an architectural project for urban rehabilitation, contact MJARC and request your quote!

REFERENCE AND FRAMEWORK LEGISLATION:
Reading this information does not exempt you from consulting current legislation:
Estatuto dos Benefícios Fiscais, DL n.º 215/89, de 1 de julho, na redação em vigor (EBF);
Lei n.º 83-C/2013, de 31 de dezembro – Lei do Orçamento do Estado para 2014;
Lei n.º 66-B/2012, de 31 de dezembro – Lei do Orçamento do Estado para 2013;
Lei n.º 64-B/2011, de 30 de dezembro – Lei do Orçamento do Estado para 2012;
Lei n.º 64-A/2008, de 31 de dezembro – Lei do Orçamento do Estado para 2009;
Lei n.º 6/2006, de 27 de fevereiro, na redação dada pela Lei n.º 31/2012, de 14 de agosto.