Extell leads air rights rush as prices soar

Valuations for vertical space surged, and in some cases, sold at par with dirt

TRD New York /
Apr.April 24, 2014 01:46 PM

The average price of air rights in Manhattan jumped 47 percent year-over-year — to $305 per square foot in 2013 — as the ballooning price of land pushed developers to build taller. Gary Barnett’s Extell Development did the most air rights deals of any developer last year.

Extell conducted  seven of the transactions for a total of 167,915 square feet – or about 27 percent of the total air rights market, according to a new report.

In some cases, air rights, which used to trade at about 60 percent of the price of land, sold at par with dirt, according to M. Myers Mermel, CEO of real estate advisory firm Tenantwise, which prepared the report. Land generally still trades at a premium though – 2013 land prices in Midtown were between $500 and $600 a foot, according to Mermel.

About 40 percent of the 34 air-rights deals in 2013 in Manhattan were for residential condominiums, while rentals made up 16 percent and hotels accounted for 36 percent, according to the report. Air rights, Mermel told the Wall Street Journal, “are the top revenue producers in any building because they become the new upper floors. You can get higher prices because top floors are the most expensive in any building.” [WSJ] – Hiten Samtani


Related Articles

arrow_forward_ios
One Manhattan Square Extell Development CEO Gary Barnett (Credit: Curbed NY)

Extell lands $690M refinancing package for One Manhattan Square

Extell Development's Gary Barnett (Credit: Getty Images and iStock)

Chelsea residents paid Gary Barnett $11M to protect their views from a planned tower

Central Park Tower

Extell just went public with Central Park Tower listings

Brooklyn Point at 138 Willoughby Street and Extell Development’s Gary Barnett (Credit: Alistair Gardiner for The Real Deal)

And you get an incentive! Extell offers to pay carrying costs at Brooklyn’s tallest tower

Raizy Haas and Gary Barnett (Credit: Getty Images, iStock)

One of Gary Barnett’s longtime deputies is leaving Extell

Gary Barnett and 1855 Broadway (Credit: Google Maps)

Gary Barnett assembling Columbus Circle development site

Extell Development chairman Gary Barnett and One Manhattan Square (Credit: Anuja Shakya, StreetEasy)

Rent now, buy later at Extell’s One Manhattan Square

206 West 17th Street, 116 7th Avenue, and Extell Development’s Gary Barnett (Credit: Google Maps)

What rich people in NYC will pay to keep their view: TRD analysis

arrow_forward_ios
Loading...