Air Rights Transfer Agreement

Air Rights Transfer Agreement

An Air Rights Transfer Agreement is a legal contract that allows the owner of a property to sell or transfer the rights to develop or use the airspace above their property. This can be particularly important in urban areas where vertical development is common and land is limited.

In this agreement, the property owner, often referred to as the "grantor," agrees to convey specified air rights to another party, known as the "grantee." The grantee can then use these rights to construct buildings or structures that extend into the airspace above the grantor’s property.

Key Components:

1. Identification of Property: The agreement should clearly identify the properties involved, including legal descriptions and addresses.

2. Description of Rights Transferred: It should specify the extent of the air rights being sold or transferred, including any limitations or conditions.

3. Consideration: The agreement outlines the compensation that the grantor will receive for the air rights, which can be a lump sum payment, a percentage of future profits, or other forms of remuneration.

4. Duration and Conditions: The duration of the rights transfer and any conditions that must be met by the grantee, such as adhering to zoning laws or obtaining necessary permits, must be included.

5. Indemnification and Liability: Provisions addressing liability for any issues that arise from the use of the air rights, including indemnification clauses to protect the grantor.

Example: A common scenario for an Air Rights Transfer Agreement occurs when a developer wishes to construct a high-rise building adjacent to a property but needs to utilize the airspace above another structure for additional height. The developer would negotiate with the adjacent property owner to purchase the air rights, allowing them to build higher than otherwise permitted under local zoning laws. This could result in benefits for both parties—the property owner receives compensation, while the developer gains valuable space for their project.