Thursday, April 20, 2006

What are "Air Rights"? How does it work?

Q: What are Air Rights? How do I know if Air Rights are available? What does that mean?

A: "Air Rights" is the term used when a Building Owner sells/transfers his unbuilt Zoning Floor Area to another Building Owner or Developer. This may happen, for instance, where a Landmarked structure, such as a Church, is located in a high-density Residential or Commercial District. The Church could be located in a Zoning District with an FAR of 10, but might only be using a fraction of this. They could sell their unbuilt Zoning Floor Area to an adjacent Owner/Developer. This would constitute an "Air Rights Transfer" or "Zoning Floor Area Transfer". The Church benefits because they receive compensation for the sale of Potential or Unrealized Real Estate. The Developer benefits because they can then incorporate this additional Zoning Floor Area into their building.

Most Commonly, the Development Lot and the Underbuilt Lot are adjacent to one another. The Tax Lots are declared to be a single Zoning Lot. This would be formalized as an agreement, and filed with the County Clerk's Office, similar to a Deed. Thus, an Air Rights Transfer or Zon ing Lot Agreement of this type should be retrievable by a Title Search or an in -house ACRIS search of Department of Finance records.

In addition, when properly done, a statement will be found on the Certificate of Occupancy stating "This Zoning Lot is comprised of Tax Lots (1), (2), and (3)", signifying that multiple Tax Lots are being treated jointly as one Zoning Lot for a Zoning benefit.