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Greek Orthodox Church faces Israeli homeowners’ ire after land sales

The secretive sale by the church, the country's second largest landowner, to a group of investors has outraged residents and church members alike.

Palestinian demonstrators protest against the visit of Greek Orthodox Patriarch of Jerusalem Theophilos III to the Church of the Nativity, in the West Bank city of Bethlehem, on Jan. 6, 2018. Palestinians have been demanding his resignation for allegedly selling church land to Israelis in sweetheart deals. (AP Photo/Majdi Mohammed)

Apartments, like these in southern Jerusalem, continue to go down in value as the leases for homes built on church-owned land come closer to expiring.  For decades various churches leased land to the Keren Kayemeth LeIsrael-Jewish National Fund (KKL-JNF), a Jewish land-procurement agency, which allowed builders to build. RNS photo by Michele Chabin

JERUSALEM (RNS) – Six years ago, when Irene Grossman purchased her home in Talbiyeh, an upscale neighborhood in central Jerusalem, she knew the Greek Orthodox Church owned the land.

But she never dreamed that the church – the second largest landowner in the country after the Israeli government — would secretly sell the land out from under her.

Like thousands of Israeli property owners, Grossman believed that the church, which in 1950 leased the land to the Keren Kayemeth LeIsrael-Jewish National Fund, a Jewish land-procurement agency, would renew the lease once it expired in 2051.

Irene Grossman. RNS photo by Michele Chabin

Instead, the financially strapped church quietly sold the land two years ago to a group of private investors who, Grossman said, are now asking homeowners to shell out “large” sums of money to buy the land under their properties outright.

“Property prices are down,” said Grossman, because buyers are deterred by the uncertainty of the situation. Grossman heads a group called Citizens Property Rights that is trying to find a solution for approximately 1,100 homeowners affected by the sale.

The sale of church-owned land is a hot-button topic in Israel, where private homes, hotels and even the Israeli parliament stand on parcels that various churches leased to them decades ago.

Some Palestinians in east Jerusalem are in a similar bind; others accuse the churches of selling land to Jewish investors who, they believe, are seeking to strengthen Israel’s foothold in predominantly Arab east Jerusalem, which Palestinians hope will be the capital of their future state.

While no one denies that the churches have the right to sell their property, many have questioned the lack of transparency surrounding the transactions from both the church and KKL-JNF.

An investigation by the newspaper Haaretz found that in one transaction, the Greek Orthodox Church sold more than 200 apartments, a commercial center and undeveloped land for a mere $3.3 million to an anonymous foreign company registered in a tax shelter. A single apartment in Jerusalem typically costs hundreds of thousands of dollars.

Palestinian demonstrators protest against the visit of Greek Orthodox Patriarch of Jerusalem Theophilos III to the Church of the Nativity, in the West Bank city of Bethlehem, on Jan. 6, 2018. Palestinians have been demanding his resignation for allegedly selling church land to Israelis in sweetheart deals. (AP Photo/Majdi Mohammed)

“In a few decades, when the existing leases for those lands expire, their fate will be determined by those unknown purchasers,” the newspaper noted.

Although Israeli lawmakers have put forth legislation that would invalidate church land sales and nationalize the property, Prime Minister Benjamin Netanyahu has thwarted such attempts after an outcry from Holy Land church leaders, who insist the transactions are legal.

The proposed legislation, and attempts by the Jerusalem municipality to tax church property, spurred church officials to temporarily shutter the Church of the Holy Sepulchre last February in protest.

While most local Christians publicly support their churches, privately they have deep reservations about how the sales are being conducted, and why.

“Our Christian communities are furious,” said Wadie Abunassar, a Christian activist, citing the secrecy with which the deals were handled and how the money is being spent afterward.

“I can understand the need to sell property. Sometimes you have to pay taxes or the location is problematic. But the church is not a private company. It serves the community and the community must be informed before such sales are made. Maybe someone from the community would be ready to buy.”

It’s one thing to sell property “because of A, B or C, and to say I did this to build a school,” Abunassar said. “If you ask the (Greek Orthodox) patriarchate it will say it’s ready to explain. I say, explain, make a statement.”

Greek Orthodox Patriarch of the Holy Land Theofilos III, center, stands outside the closed doors of the Church of the Holy Sepulchre, traditionally believed by many Christians to be the site of the crucifixion and burial of Jesus Christ, in Jerusalem, on Feb. 25, 2018. The leaders of the major Christian sects in Jerusalem closed the Church of the Holy Sepulchre for several hours to protest an Israeli plan to tax their properties. (AP Photo/Mahmoud Illean)

A senior official from the General Secretariat of the Greek Orthodox Church in Jerusalem defended his church’s land sales.

“We have always sold land,” the official said. “The only difference is that now it’s landed in the media and various factions from all sides are trying to weaken the church and use it as a political football.”

The money from these sales helps sustain local churches, monasteries, clergy, schools and clinics in Israel, the West Bank and Jordan, he said.

The official said the church assumed it would renew its contract with KKL-JNF, but that an unfortunate incident made the agency wary about a deal.

“In the late 1990s, two fraudsters approached KKL and convinced them to pay $20 million to renew the leases. They forged the patriarch’s signature and had it notarized. A few weeks later we learned of the fraud and eventually $4.5 million of that money was recovered. The patriarchate and KKL were both victims.”

After the incident, the official said, KKL-JNF was prepared to renew the leases – for $4.5 million. The patriarch refused, insisting on $20 million, the same price KKL-JNF had paid to the criminals.

In 2016 the church sold the land in Talbiyeh, as well as other properties, to Nayot Komemiyut, a group of private Jewish investors, for $42 million.

According to the church official, KKL-JNF could have called the patriarchate at any time and negotiated a deal “but KKL didn’t do that.” Now, he said, KKL-JNF can negotiate with the land’s new owners.

A KKL-JNF spokesperson responded that “throughout the years, the church refused to sell the lands to KKL-JNF. In 2000 KKL-JNF made another attempt to acquire the land rights, a deal which turned out to be fraudulent as KKL-JNF fell victim to a case of deception. The first time the Greek Orthodox church agreed to sell its rights to the lands was to the same group of anonymous investors. Any claim stating otherwise is false.”

“This is a national matter, and all parties should address it accordingly,” the spokesperson said.

A Nayot Komemiyut lawyer said that the company is prepared to negotiate a new leasing deal with KKL-JNF but that it hopes to sell the land to the apartment owners outright, with financial support from KKL-JNF if necessary. He estimated that homeowners – with or without the assistance of the land agency – will need to pay about 20 percent of their apartments’ market value to procure the land under their homes. The amount will only increase as the years go by, he said.

“We’re actually a solution for them, not the problem,” the lawyer said of the homeowners.

Grossman, however, is looking to KKL-JNF to solve the problem. “A lot of the people living in our neighborhood are older people, and unless they can sell their homes, many won’t have the money to move into assisted living or a nursing home. We need a solution,” she said.

“Our only hope now,” Grossman added, “is that KKL will mediate with the new owners to come up with a fair price to extend our leases.”