15th January 2020
Airspace development is a term to describe a form of property development whereby unused space on rooftops of existing buildings is converted into new homes.
As London faces a chronic housing and land shortage, these developments above existing buildings provide an innovative way of unlocking potential to deliver much needed housing in dense areas. Often the freeholder and developer may first enter into an option agreement, allowing the developer the time to achieve planning for a proposed single or multiple dwelling before formally acquiring the air rights.
There are many reasons for developing the air rights above a building – not just providing new homes. These developments can also bring about significant improvements to the existing building by investing some of the money negotiated within the acquisition agreement into communal areas, which they otherwise would be unable to afford.
Such improvements could include works to the landscaping, external walls, communal doors, windows, electrical and fire systems within the building. Not only does this provide a better environment for current residents but it is likely to generate an uplift in value in the long run, creating a more valuable asset. And for the existing residents there is also the longer-term benefit of reduced service charge bills, as communal costs would be shared amongst more apartments.