The Fungibility of Air
Space is the essential raw material for building, and virtually every square foot of ground in New York City has been exhausted. With the last of the city’s green fields long since occupied, “growth” has become synonymous with density, and to gain more ground, real estate has become an extractive industry, mining the air.
Property, however, has historically been measured only in two dimensions, as a piece of the earth’s surface, typically calculated in square feet or meters, acres or hectares, miles or kilometers. This seems straightforward, but the vertical dimensions of ownership confuse things. Consider the issue of access to what lies beneath, such as petroleum (where the possibility of horizontal drilling remains contentious) and minerals (likewise). Matters are made more difficult by the presence of a variety of subterranean infrastructures, from sewers to subways. But the presumption has been that anything dug up or sucked out within the perimeter of your property is yours.
The question of ownership of the space above the surface was codified in the medieval formulation Cuius est solum, eius est usque ad coelum et ad inferos: “Who owns the soil also owns up to heaven and down to hell.” The principle remains an effective legal foundation for the determination of property’s verticality, but the simplicity of the concept has been undermined by transformations in technology and urban form. It seems that the first conversation about air rights was prompted by the birth of aviation: initially by the balloons passing overhead in late eighteenth-century Paris, and later by the arrival of low-flying aircraft. Arguments about the height of the heavens have arisen from issues of trespass, privacy, danger and nuisance.
The signal event in the invention of the modern concept of air rights was the construction, in 1915, of the Equitable Building in lower Manhattan. Rising 538 feet, it was the largest office building in the world at the time, dwarfing its surroundings. The Equitable also cast an enormous shadow that prompted the city to draft its seminal zoning code of 1916, which imposed a system of setbacks from the curb for tall buildings so that sunlight could better reach the street. This, at a stroke, created a special value for air—for the void—that restricted the absolute capacity of a developer to occupy the space above the plane of ownership. The public right of access to sun and air was held superior to the uninfringed right to build ad coelum.
The regulation of building form specified by the 1916 code was, in many ways, an extension of a decades-long struggle for tenement reform. That fight had prompted a series of changes in the city’s building regulations, with sanitary systems, fenestration and fire protection being progressively modified to provide natural light in every room, plumbing on every floor and at least two means of fire egress. By the end of the nineteenth century, government had asserted a purview over the form, use and performance of buildings and spaces in the city, one that required the compliance of private interests and restrained their right to develop properties without restriction.
The city’s zoning regulations were extensively rewritten in 1961, largely to reflect the architectural fashion of the day. The changes introduced a new instrument—something called the “floor area ratio,” or FAR—for measuring property rights and balancing them against the public interest, not simply in day lighting but in density. FAR is a widely used multiplier that specifies how much volume can be built on a given site. For example, on a hypothetical lot of 100 square meters with an FAR of 2, a building with a total area of 200 square meters would be permitted. However, even with this change, zoning continued to stipulate a formula meant to guarantee that sunshine would reach the street and that specified the uses permitted on a given site (indeed, the law saw a huge increase in the numbers of use and bulk categories). The most dramatic transformation to the city’s skyline was the disruption of the celebrated “wedding cake” profile of tall buildings by a new style of towers; set behind plazas and rising without setbacks, they made a controversial break with the convention of uniformly aligned street walls.
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The 1961 changes also opened up fresh speculative territory. One involved air rights, a measure of the difference between the bulk of the existing building and what zoning permits. FAR functions as their gold standard, regulating the amount of air in circulation. FAR is a form of pure wealth, its exchange value floating free of actual utility. The city has pursued a series of policies that commodified FAR in transactions of alleged public benefit, a crucial speculative moment in the invention of the culture of the “public-private partnership” that has come to dominate planning in New York.
Two concepts underlie the monetization of FAR: bonus and transfer. With a bonus, the city grants the right to add bulk beyond the underlying zoning, and it is typically offered in exchange for some nominal public good. This swap has generally turned out to be a rum deal for the commonweal. Witness the scores of vapid mini-plazas in Manhattan, the work of developers seeking to outclass each other in their pursuit of maximum benefit for marginal improvement. Bonuses have also been given to induce development in areas thought to be in need of stimulus. The rehabilitation of Times Square and the west side of midtown were induced by tactical “upzoning.” The latest bonus gambit is so-called “inclusionary” zoning, in which additional bulk is offered if the developer includes “affordable” housing as part of the project. As this bonus is strictly elective, it has produced only modest results. Mayor-elect Bill de Blasio has suggested that he will make such inclusion mandatory, which could be a crucial step in rebalancing the city’s housing stock, if he can follow through.
A more promiscuous mode of trading in air is the transfer. The concept is that many lots are not built to FAR capacity and that this surplus can therefore be measured, sold and reallocated to another lot. Historically, the distance over which this surplus value could be transferred has largely been limited to the block on which it originates. However, the Bloomberg administration has been open to a far greater fungibility of these rights, which were central to its increasingly desperate efforts to upzone the seventy-three-block area around Grand Central Terminal. The plan would have effectively created an air bank into which the unbuilt and unoccupiable areas above local landmarks (such as St. Patrick’s Cathedral, Central Synagogue and Lever House) could be deposited and presumably sold at the market rate, driven by its inherent scarcity. The mayor withdrew the proposal in November when he realized that its defeat in the City Council was imminent, but it is likely to re-emerge in modified form.