The airspace of a building is typically owned by the freeholder, the leaseholders who own the freehold or it could be sold to a property developer or investor.

The airspace refers to the area above a building and following changes in government regulation in 2020, the rules and planning permissions have become extremely relaxed, making the air space above buildings very ripe for development.

Whether it is property developers or owners, the opportunity to add an extra couple of floors to the building is very appealing, increasing the value of the property and the potential revenue that could be earned by adding new tenants. Or there is an opportunity to add further amenities such as rooftop bars, leisure facilities or offices.

Does The Freehold Own The Airspace Of a Building?

Yes, the freehold owner is typically the first person who owns the airspace of the building. But this can be structured in two ways:

1. The freehold can be collectively owned by the leaseholders of the building, known as a ‘share of freehold structure.’ In this scenario, every leaseholder owns a portion of the leasehold. This may be one share per flat, for instance.

2. The standalone freeholder is an individual or company who is separate from the leaseholders of the building and owns the entire freehold. This allows the individual to choose what happens to the airspace in any way. This might be keeping the airspace and doing nothing with it, developing it or selling it privately to another individual or company.

What Are Air Rights?

Air rights refer to who owns the airspace of the building. This is the legal right to use and control the space above a building or piece of land. 

Since the air rights are so valuable, especially in popular built areas such as London, they can be purchased, sold or leased independently. 

With this, there are air transfers where they are transferred from one individual to a private company or group of individuals. 

Can I Sell My Air Rights or Airspace Above My Building?

Yes, absolutely, it is a common feat these days to sell the airspace above your building to a group or private individuals and it can be very valuable, especially in attractive parts of town.

Do I Need Planning Permission To Develop My Airspace?

Today, there are a lot of airspace development projects where no planning permission is required. As per the passing of a Government legislation in 2020, if the building and project falls under permitted development, there is no planning required. This includes adding two additional storeys to your property if it already has 3 or more stories. The ideal buildings for developing airspace are private homes, office blocks, residential blocks of flats, high street shops and more.

Can I Get Airspace Development Finance?

Yes, KP Finance is delighted to offer an airspace development finance product which allows developers to borrow £1 million or more. A lot of mainstream lenders do not lend against airspace, however, we have a superb track record and strong understanding of how it works. The development of additional rooms, flats or offices can add significant value to the overall property and generate additional revenue streams.

For more information, please contact the KP Finance team by phone on +44203 488 1128 or email the team at enquiries@kpfinance.co.uk