Sale of Air Rights

I own a 2 family frame in North Brooklyn (3 stories; 16.67 wide by 40 deep on 2 floors and 16.67 by 50 deep on the bottom floor). The 2 houses to one side of me are in contract to a developer who has reached out to me about my air rights. I have probably about 3000 unused sq ft; maybe slightly more. I don’t plan to use any of these air rights myself. Thinking about resale, I don’t think a residential buyer would do anything other than build a 4th floor (unlikely since it’s a frame house) or maybe extend out back about 15- 20 feet. My taxes are very high already (2 renos allowed the Dept of Fin to bump me twice) so a private buyer may not wish to do anything. And a developer probably wouldn’t pay me much given my narrow lot size (there would only be one other neighbor on my other side with a narrow lot as well – combined sale unlikely). Long story short, I’d like to consider this (price to be negotiated) but I don’t know where to start. Does anybody have a lawyer that can advise on this very specific matter? How would this sale be taxed? I know there’s a merger of lots, b ut what exactly does this mean for me? What are the risks to me – immediately and in the future? I can’t find any info online. Thanks!

sharon121

in General Discussion 3 years and 9 months ago

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nyc_sport | 3 years and 9 months ago

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You need more facts, and will have to poke around to find an architect and/or lawyer experienced in this (including figuring out exactly what air rights you retain). In prime Manhattan, air rights can fetch $500/ft. I don’t know the going rate in North Brooklyn, but you need to know what leverage you have and what dollars are at stake.

cate | 3 years and 9 months ago

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Would it be advantageous to the developers to buy your entire property, not only the air rights? Will what they build devalue your own building by robbing it of light, air, etc.? I’ve seen cases where the last holdout of a development parcel a developer is assembling gets three times what the property would normally be worth. In any case, you will absolutely need a lawyer to represent you and negotiate on your behalf. I can’t make a recommendation but start with an attorney who specializes in real estate for development in Brooklyn specifically.

BKALLDAY | 3 years and 9 months ago

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Just don’t. If you are considering selling but have sold your air rights you kinda devalue your own property. A lot of developers are rats on two legs and if you end up staying you have given up any claim or ability to intervene on your own behalf regarding how the space is used.

hkapstein | 3 years and 9 months ago

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I see your point, those air rights may be worth more in this situation than they will be in the future, but in my view this unfortunately is a mostly economic decision rather than a legal one, and while I do think it makes sense to talk to a lawyer about the implications, ultimately it is your judgment whether selling the air rights would be in your best interest. Selling the unit entirely would eliminate the need for your to perform this valuation, and might be smart for all the reasons Resident2 states, but it is your home so it’s your call.

ceci | 3 years and 9 months ago

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You asked about the risks involved in pursuing this endeavor and Resident2 in my opinion is accurate and precise in his recommendation !!! Good Luck to you!!!

sharon121 | 3 years and 9 months ago

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Thanks, but this is a post about selling air rights, not the house.

resident2 | 3 years and 9 months ago

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You do not mention if your house is attached to the “developers” two houses. If you are detached you may be slightly better off, but if you are attached & they intend to knock down & build all new foundations etc. Your house is going be severely impacted. (damaged)
Tell them to buy you out in full. Do not sell your air rights, because it will effect the value & sale in the future, to what extent depends a lot on what they build next door & who / what ends up occupying it as well as how much damage was done to your house in the process. The costs of protecting your house during construction will be a lot & for the developer to say that they will pay for your Engineers, Inspection, Insurance etc… who chooses? To talk about insurance never compensates for the historic nature of a frame house or the stress and your peace of mind. You will get a capital gains bill, consult an Accountant.
Tell them to buy you out or No air rights only.