Due to the relaxation of planning rules in 2020, allowing rooftop extensions of up to two storeys, we are increasingly seeing freeholders look to capitalise on the airspace above their property by selling the air rights to a non-specialist airspace developer or other third party.
Often, they have done this without consulting the leaseholders who are simply served the statutory Right of First Refusal (Section 5a) notice stating the freeholder’s intention to dispose of the air rights. It can come as quite a shock to leaseholders that a development maybe coming forward above their property that they have little or no say over.
If you are in this situation and have been served a Section 5 Notice by your freeholder knowing your options and legal rights is paramount. Can you refuse? What is the airspace worth and how do you know if it is a good offer or not? These are just some of the questions you may have.
Our ethos at Fruition Properties is that airspace development should be a ‘win-win’ opportunity, delivering value to all of the stakeholders involved and sharing the development gains with the leaseholders so that those most impacted by any potential airspace development also benefit.
When freeholders are not willing to work with leaseholders, we assist groups of leaseholders to acquire their entire freehold through a process known as Collective Enfranchisement (Section 13) and work hand in hand to deliver value for all stakeholders.
By acquiring the freehold themselves leaseholders not only own their freehold, (with no further ground rent to pay) but also have the right to be involved in the design of the airspace development. Most importantly they can take a profit share in the completed development and or enjoy the benefits of any upgrade works included to the estate or building.
Both leaseholder rights and airspace development can seem complicated so please get in touch and we will be happy to provide advice.