Benefit From Economic Growth Moving Up
Individuals Globally Are Building The Network
The air will soon be almost as valuable as the land, and the leading indicator for this global movement is coming from NYC.
Other cities, including Boston, Sydney, and London, use air rights for growth and development. More housing, improved transportation, and less restrictive zoning address the housing and transportation issues that plague many of the planet's cities and towns. Reducing barriers to allow market forces to determine the optimal distribution of air rights resources leads to exponential growth.
Given that it's US Presidential election week, it’s interesting to see how one candidate values air rights and utilizes them to increase the value of his real estate. (This is not an endorsement or otherwise; it simply illustrates how a prominent person uses air rights.)
Infrastructure In Cities Nationwide
Departments of Transportation (DOT) have hidden gold pots to improve communities' lives nationwide. Boston has significant development demands. The air rights along the Boston extension of the Massachusetts Turnpike accommodate new uses to meet the needs of residents, businesses, and institutions. The redevelopment of the former rail yards and its air rights into the Prudential Center complex is a clear example.
Building upwards into DOT’s air rights shows how air rights assets can increase communities’ economic advantages. It doesn’t stop there.
Other DOTs are using their air rights to improve the transportation systems. This is taking the form of opening the skies for cargo and delivery drone transit and enabling the infrastructure to be developed for air taxis and electric verticle take-off and landing (eVTOL) vehicles. Recent changes from the Federal Aviation Administration (FAA) allow eVTOLs to take the next steps to get us closer to the flying cars we want, and many States aim to take advantage of these new developments.
Most States are considering leasing their air rights for profit, and private air rights owners can now do the same. They can receive income from drones and low-altitude transit and buy and sell air rights for profit.
NYC Land And Air
With land prices increasing and insufficient space to build horizontally, attention is focused on the right to build vertically. In NYC real estate, the total number of cubic feet allowed to be built into works in conjunction with zoning law. With many underdeveloped areas, millions of dollars are hanging in the air.
The One Constant Is Change
Air rights, with or without zoning, are becoming more valuable. Many areas where real estate prices have been soaring for several years, like parts of Lower Manhattan, Harlem, and North Brooklyn, have large amounts of unused air rights, and those owners need to find a way to release the cash and connect with air rights traders and users.
Air rights made two of the apartment towers on Manhattan’s Billionaires’ Row, 15 Central Park West and 220 Central Park South the most profitable buildings in the history of New York City.
Zoning Reform
The City of Yes in NYC is a zoning reform that aims to create more housing in every neighbourhood and utilize airspace. Price signals are ringing across the five boroughs, and the changes will make building more homes in areas with high demand even easier.
The value of air rights is only just beginning to be recognized, and it's an area that's going to become increasingly important in the future. - Michael Berger, Managing Director of the Urban Land Institute (ULI) New York Chapter.
Increased Air Rights and Transfers
One key aspect is the increased availability of air rights. If the tools are available, this would enable vacant offices and other non-residential buildings to be converted into homes by transferring air rights quicker and more efficiently.
Creating a win-win policy is often promised, and while it is impossible to please everyone, this policy benefits both property owners and residents. This proposal boosts property values and creates more active, vibrant neighbourhoods by allowing for more use.
Change And Innovation Is The Fabric Of The City
Like many of the most popular residential neighbourhoods in New York, the Upper East and Upper West sides were built with height limits far lower than those in place today; as a city's needs and requirements develop, so does the airspace people build into. Landmark buildings will also have more flexibility in transferring their air rights. One goal is to give these buildings more opportunities to benefit from unused air rights.
The rule changes would let developers build bigger buildings, allow taller buildings around transit areas, reduce parking requirements for new developments, permit additional dwelling units, and facilitate infill development on large lots.
Air Rights Unlock More Housing Supply
NYC’s 41-year-old "sliver law" may be repealed in tandem, allowing buildings on narrow lots to reach higher heights. This will unlock up to 51,000,000 square feet of new housing, equivalent to 76,000 units. These air rights have become even more valuable, and they need a place to find the right clearing price for their owners.
Properties with views are sold at a premium, with some streets commanding significantly higher sale prices than those without views. The views can be a significant selling point, making a property more desirable and valuable.
Air rights traders who own air rights can help those who want to protect their views and gain from their trade, and these parties need a place to meet.
From the US to the UK, Australia, and beyond, real estate owners spend hundreds of thousands of dollars to secure air rights above neighbouring properties, increasing their property’s value. The air rights can serve as a floating ceiling that prevents neighbours from encroaching on a view, creating a significant advantage in terms of value per square foot.
Because these air rights are so valuable, people are going to extreme lengths to buy up properties, carving out the rights for their requirements, re-selling the underlying real estate, and gaining significantly. They want a more efficient, liquid way to do this.
Buying real estate outright can be capital-intensive. The solution is to make air rights available in a digital marketplace where we can transact, buy, sell, or rent air rights for aerial transportation, views, and building development.
This provides a more efficient and cost-effective way for traders and real estate owners to secure air rights and maximize their property's value.
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