Featuring real estate articles and information to help real estate buyers and sellers. The Nest features writings from Georges Benoliel and other real estate professionals. Georges is the Co-Founder of NestApple and has been working as an active real estate investor for over a decade.
When you have a place like New York City, everything has a protocol, a fee, or even a special process or concept. Even something along the lines of air or “space above” can have a certain way of being parsed out. That’s why air rights in NYC are a thing, but what does this mean in the Big Apple? Air rights are the rights to the space above your apartment building or condo. Like how companies treat carbon emissions rights, entities can buy or sell air rights. Only a set number of those rights are available for each part of the city. If you are a building owner, it makes sense to understand what these rights offer you and how developers can use them. You might be shocked to hear the truth about NYC’s city planning! How to buy or sell air rights in NYC?
In the olden days, New York City was all about building upwards rather than outwards. The problem is, this isn’t good in large quantities.
Building too high up all over the place would make the city unbearably dense, not to mention significantly darker. People balked, so they came up with the concept of air rights in NYC.
Air rights are rights over the space above your apartment’s rooftops. In New York, this includes the right to develop a building upwards. Each area receives a specific amount of rights, which can be transferred from building to building. This way, owners can choose to give their rights away to a developer if they so choose.
Air rights are a combination of things, to be honest. The most important factor is the Floor-Area Ratio.
This is how much floor space you have compared to your lot’s area. In some districts, people are given less area than in others.
New York City is pretty persnickety about how your can develop your buildings.
Because air rights are such a hot topic in this city, the government went so far as to create a regularly-updated map that illustrates where those rights currently rest and where buildings have been marked as “totally done.”
Honestly, it’s not like you can just sell your rights the way that most people would oil rights. There are three common methods by that air rights in NYC get transferred. Each has its own process, often assisted by lawyers:
Those rights show how many more square feet you can add to the top of your building. So, if every floor is 10,000 square feet, those rights that total 20,000 square feet would allow you to add two more floors to the top of your building.
Citywide, air rights currently cost $225 per square foot. However, the price in your area can be particularly pricey or cheap, depending on the local land costs.
This can be as pricey as $400 and up on the Upper East Side or at little as $100 per square foot.
It’s worth noting that most parts of the city will have more expensive airspace than the actual floor space. This is because the potential for development often ends up being a premium price.
It might be soon. The NYCHA currently owns the lion’s share of the air rights. Over 80 million square feet of unused, unsold air space are part of NYCHA’s holdings. New York might see many of those square feet being used in transactions depending on how things go.
The release of that air space is part of the city’s 10-year plan to encourage expansion and innovation and improve the rent crisis. Whether or not this will bode well for the city depends on many factors. However, it’s safe to say that we’ll see building up pretty frequently.
This can be tricky, but there’s some good news. Air space is all documented as a part of a building’s materials. So, when a listing occurs, the agent has to search for building rights.
Similarly, to sell building rights, you may need to talk to a brokerage or a real estate lawyer to do so.
Air rights can get very difficult, very quickly. That’s why it makes more sense to have a brokerage help you determine your options while you sell, merge, or buy more rights.