[NYguy]

https://therealdeal.com/new-york/202...zed-buildings/

Gary Barnett deal shows way to save rent-stabilized buildings
City of Yes allowed more air rights transfers, helping landmarked properties

When you think Gary Barnett, you think Billionaires’ Row penthouses, not run-down rental buildings.

But Barnett’s Fifth Avenue air rights deal offers a solution for rent-stabilized properties in crisis.

Barnett’s Extell Development is acquiring 135,000 square feet of air rights from the Metropolitan Club on Fifth Avenue for his mixed-use project at 655 Madison Avenue — a deal made possible by the City of Yes.

The club’s 790 Fifth Avenue is a landmark. Before City of Yes, it could sell air rights to a very limited number of properties next to it, but because the market was microscopic, a deal never happened. The club is only using 42 percent of its theoretical square footage, according to PropertyScout.

The City of Yes for Housing Opportunity, passed in 2023, allowed landmarks to transfer air rights to sites farther away. Barnett’s development site is a full avenue from the Metropolitan Club, but now it can acquire the club’s rights.

If Extell uses the 135,000 extra square feet to build more apartments, it would mean homes for hundreds more people and millions of dollars of additional tax revenue. I think we can all agree those are good things.

Another plus: The Metropolitan Club will get money from the sale. Landmarks are expensive to maintain, and the sale proceeds will be used to fund continuing maintenance under a plan filed with the Landmarks Preservation Commission.

Given the extra costs that the commission imposes on buildings when it makes them landmarks, expanding their ability to sell air rights was the least the city could do.

Why not help rent-stabilized buildings in the same way?