Permitting real estate in Israel

The police destroyed a luxury "villa" (pic) and an unfinished department building in the Arab neighborhood of Ramla. They were built on public lands and had no building permits. 

How were they connected to the municipal infrastructure - water, sewage, streets?  What were the owners of these buildings thinking - maybe they believed they always could pay off the major? 

These actions are very good for the permitting business.