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A plan to build luxury private homes near tenements in Jerusalem's Kiryat Hayovel neighborhood, which according to earlier plans were to have been rebuilt for their residents in the area, has sparked yet another legal battle in a neighborhood already fraught with religious-secular tension.

The area, on Brazil and Olswanger Streets in Kiryat Hayovel, is home to some 600 poor and single-parent families, many new immigrants and the elderly. The buildings are in such poor condition that it had been decided that rather than renovate them, they should be demolished and rebuilt.

However, two months ago the Israel Lands Administration issued a tender to lease nearby land on the slopes of the southwestern neighborhood of the capital, with a picturesque view of Ein Karem, to construct 53 expensive private homes, but not to rebuild the tenements.

The plan to demolish the old apartments and rebuild them on the same site was to have given a better future not only to the 600 families, but for secular residents even from other areas of Jerusalem. "This is the largest reserve of apartments in the area for the young, productive population," Esther Kotzer, a planner with the Kiryat Hayovel neighborhood administration, said.

The plan to rebuild apartments for the tenement dwellers "was intended to erase an architectural and social mistake and heal an open wound for the benefit of the residents and in general," attorneys Arik Naor and Benjamin Hyman wrote in an appeal against the tender submitted to the Jerusalem District Court in the name of the residents and the neighborhood administration.

The ILA's refusal to link the two parts of the plan, according to the appellants, "kills the possibility of creating two things - rehabilitating a poor area and creating apartments for young couples. These tenements will remain a blight forever."

Residents say their main concern is that the area slated for the private homes is close to land controlled by entrepreneurs, among them Shlomo Deri, the brother of former minister Aryeh Deri, who is ultra-Orthodox. The residents are afraid that if these individuals gain control of the land for which the tender has been offered, they will change the existing plan and build hundreds of housing units that will be sold to ultra-Orthodox families. If that happens, residents say, it will be the end of secular Kiryat Hayovel.

"I did not bid for this tender," according to Shlomo Deri, who also noted that he is not ultra-Orthodox. "That does not mean I won't, but there is no intention of building an ultra-Orthodox or religious neighborhood, Deri said.

The ILA said that because the land in question is for open sale, it cannot be linked to the allocation of land for rebuilding the tenements. "The ILA never held talks with the residents [of the tenements] and certainly never promised to allocate land" for the reconstruction of their apartments, the ILA said.