Manhattan Views Can be Worth Up to $11M for Residents - The Jewish Voice
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Thursday, July 7, 2022

Manhattan Views Can be Worth Up to $11M for Residents

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By: Hellen Zaboulani

How much would loft owners put up to protect their Big Apple views? In the unusual and enchanting story, as told by the NY Times, residents of a 12-story building in Chelsea paid the developer of the neighboring building not to build upwards. When the group of residents heard that a tower was being built next door, threatening to darken most of their windows and block their views, they purchased the neighbors air rights, at fair market value. The loft owners had no plans to use those air rights at all, their main intent was to block the developer from building anything taller than the three- and four-story buildings that had been there.

The deal actually took place in 2016, but somehow it had not been reported until now, as those involved were not eager to talk about it. The veteran developer, Gary Barnett of Extell Development, had expressed his intention to put up a 145-foot condominium, replacing a set of short buildings at Seventh Avenue and West 17th Street. The new building was slated to be about as tall as theirs, and positioned directly to its inside, as per the NY Times. The group of residents moved fast, meeting with Mr. Barnett to purchase the air rights, and negotiate a fair price. “It’s not common,” Mr. Barnett said of the deal. “Most of the time, they sue you and try and stop you somehow. These people stepped up to the plate and paid market value for the building rights.”

The building’s residents split the $11 million fee, in a way they thought just. Not everyone paid the same amount. The higher-floor owners paid the most, the lowest floors paid nothing, and residents in the middle floors paid something in the middle. “It was expensive,” said John R. Muse, 68, a Texas investor and absentee owner whose grown children live in the building. “I wouldn’t say prohibitively. But expensive.” Mr. Muse said that he could not recall exactly how much he had paid, but estimated that his unit’s share was about $1 million.

The L-shaped loft building in Chelsea, which was formerly a warehouse, has attracted artists and celebrities. The building boasts high ceilings, large full-floor spaces of up to 5,600 square feet, and of course sunny views of Manhattan’s skyline and the Empire State Building. Actor Harrison Ford owned the penthouse, until he sold it for about $15 million in 2012. Recently, one of the units at the building was sold for $9.75 million. Had the building had less expensive apartments, such a fee would never have been paid for the views, and such an immense amount of money would never have been agreed to, or mustered up by the residents.

While deals of this sort are unusual, especially at such an exaggerated price point, there have been other instances. Zen Studies Society, a religious institution on East 67th Street, had a neighboring six-story apartment building pay $3.25 million to purchase their air rights, so that future developers would not block their windows.

 

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