In highly competitive real estate markets such as New York City, every inch of space holds immense value, even if it’s just empty air. In a fascinating development, property owners have the privilege of utilizing the airspace above their land as they see fit, thanks to a legal concept called air rights.
Air Rights in NYC
In the world of New York City real estate, air rights pertain to the ownership of the space above a particular property. Having air rights grants individuals the authority to determine how they wish to utilize or leave undeveloped the designated space. Air rights, also known as “transferable development” rights, provide developers with the opportunity to expand their buildings or protect their investments from the influence of other builders.
When purchasing a property, one gains ownership of the airspace directly above the land, which can be reasonably utilized in conjunction with the property. The definition of “reasonable use” may differ based on the specific zoning laws in each locality. However, according to the government, any road that exceeds a distance of 500 feet is typically classified as a “public highway.” Furthermore, the construction height may be influenced by local zoning regulations.
How Much Are Air Rights in NYC?
The price of air rights usually falls within the range of $100 to $300 per square foot. In Manhattan, the prices for purchasing air rights are higher compared to other areas, ranging from approximately $200 to $400 per square foot. This is because of the limited availability of land in the area.
The price of buying air rights is determined by their perceived value to potential buyers, just like any other form of property rights. The cost of air rights above valuable real estate can rival that of purchasing a residential or commercial property. In areas with more spread out development, air rights may not hold the same level of value.
Buy Process of Air Rights in NYC
Research the Local Zoning Restrictions
It is crucial to adhere to the local zoning laws when constructing buildings. In New York City, the zoning code dictates the floor-to-area ratio, which limits the amount of square footage that can be constructed on a specific property. By determining the FAR and the allowable square footage of the building, one can ascertain the air rights granted by purchasing the property.
Buy the Property
Acquiring air rights can be achieved by either buying undeveloped land or demolishing an existing structure. Imagine purchasing a 10,000-square-foot plot of land with a FAR of 5.0. According to reports, the property in question comes with an impressive 50,000 square feet of air rights for potential development.
Purchase the Unused Development Rights
In certain situations, acquiring the unused air rights to a neighboring building can pose additional challenges, especially if you are not the property owner. This may be necessary if you wish to expand horizontally or safeguard your scenic view of the city’s skyline. One way to achieve this is by acquiring transferable development rights, which can be obtained through various methods.
Do a Zoning Lot Merger
In a zoning lot merger, the owner of the neighboring building agrees to sell their air rights at a predetermined rate, resulting in the combination of the two zoning lots. In a significant development, the new owner now has the opportunity to obtain unused air rights, which can be used to expand the recently established zoning lot or halt any future development. There are specific requirements for a zoning lot merger, including the condition that the properties must be adjacent to each other for at least 10 linear feet.