Before Benjamin Myers secured an agreement to build condos above the Red Rose Transit Authority’s Queen Street Station Parking Garage, he knew it was likely not the first structure in Lancaster County to use the development tool known as air rights.

“I was told that the first air rights sale in the nation took place in Lancaster,” Myers said.

That factoid came from Kevin Molloy, director of the Lancaster Convention Center Authority, who said he in turn had heard the claim from a local real estate agent.

The county’s first purported air rights sale they were referring to took place in 1798 between the then borough of Lancaster and the Masonic Lodge No. 43. The original written agreement is still in the hands of the lodge, and it shows the deal with borough officials certainly resembles something like an air rights agreement. (Lancaster became a chartered city in 1818 and a third-class city in 1924.)

Air rights is a development tool for separating ownership of property, essentially at an imaginary line somewhere above ground. Webster’s dictionary defines it as a property right to the space above the surface area or object.

“We’ve kind of gone full-circle with the whole thing,” Molloy said of the Queen Street Station Parking Garage project. “It’s a good way to use property because, frankly, it’s what other communities are doing more of now.”

The 1798 agreement between the Masonic Lodge and the borough of Lancaster called for the construction of the Masonic Hall on West King Street next to Old City Hall with arches and pillars to support a market house below. The Masons would pay for and control the space above the market, but the borough would still have control over Market Square and the market space beneath.

It was no doubt an unusual deal at a time when white settlers had already expelled most of the indigenous communities in the area and land was plentiful. But even in a town that was still mostly undeveloped, the Masons must have wanted a central location to meet.

The modern-day plan from Lancaster city-based development firm Eberly Myers to build condos above the Queen Street Station Parking Garage comes during a severe housing shortage in a city where developable land is scarce and retrofitting or replacing existing buildings is prohibitively expensive.

It’s the kind of conditions in the real estate market that could lead developers to think creatively about where to build, including above an existing structure owned by someone else.

But in the 224 years since the Masons agreed to build above property owned by the borough of Lancaster, evidence of using air rights as a development tool in Lancaster County is few and far between.

In 1970, the Lancaster Parking Authority bought the rights to 150 rooftop parking spots in the Lancaster Square renewal project. The parking spots were planned for the top of Brunswick Mall, where the Christian Street Garage is now located, and a planned department store where the county building now stands at 150 N. Queen St.

A decade later, a developer petitioned Lancaster city for air rights so he could build a walkway between two buildings for a proposed racquetball club at 130 and 131 E. Grant St., according to newspaper archives. The plan never materialized.

In the early 2000s, Penn Square Partners, the developers of what is now the Lancaster Marriott at Penn Square and the Lancaster County Convention Center on South Queen Street, proposed selling the Watt & Shand building to the Lancaster County Convention Center Authority for $5 million in exchange for the air rights to build a tower behind the historic building.

The final agreement between the authority and Penn Square Partners to develop the convention center and hotel was a different arrangement, Molloy said.

‘To the heavens’

With roots in English Common Law, land ownership in the United States means control of a space beyond a two-dimensional set of lines in the dirt.

“The ownership of a property extends all the way down to the core of the earth and up to the heavens,” said Matt Creme, a Lancaster-based land-use attorney and solicitor for various municipalities in the county. “And you can – the word is ‘sever’ – the mineral rights for example, or the air rights and sell those separately.”

The same idea also applies in other ways, Creme said, like when it comes to utilities. Take a sewer easement.

“The sewer utility has the right to possess the land below the surface and occupy it, and the property owner has the right to do whatever he or she wants above so long as the sewer utility can get in and under that,” Creme said.

Likewise, whatever entity owns the power lines that extend to any house or property essentially also owns the rights to the physical space it uses in order to deliver electricity, Creme said.

There is generally no distinction between easements and air rights or “mineral rights,” the area below ground, Creme said. They all essentially carve out a slice of a property that is controlled by another entity.

One common application of air rights are walkways that connect one building to another, Creme said. A developer like the one with the 1980 racquetball club proposal needs permission from the owner of a publicly-owned road, in that case Lancaster city, to own the area above the street for a walkway.

The Masonic Hall

Nat Gilchrist, a member of the Masonic Lodge No. 43, showed LNP | LancasterOnline the original handwritten agreement between the borough of Lancaster and the lodge from 1798.

After 224 years, the building still stands at 7 W. King St.

The Masons eventually took ownership of the building over a period of years. Property records indicate that in 1973 several lodge trustees handed the building over to Lancaster city.

The Masonic Hall project first came about when Lancaster borough officials decided the new “Market House” they had commissioned in 1795 wasn’t big enough, and they needed yet more space for vendors, according to a 1918 article in Journal of the Lancaster County Historical Society on the history of the Central Market.

The local elites that made up the membership of the Masonic Lodge No. 43 offered to build a “superstructure” on top of the borough’s existing market. The floor above the market would be used for lodge meetings, and a series of pillars and arches would support the extra weight for the enclosed market below, the original agreement shows.

The borough agreed to the idea with the Masons with the caveat that the government would have access to a room in the building for conducting its business.

In the same period, Lancaster became Pennsylvania’s state capital from 1799 until 1812. When in session, the state legislature met in what is now the Visitor Center.

The 1918 article in Journal of the Lancaster County Historical Society describes how the county paid the Masons rent for using its room for court proceedings, while the state legislature occupied the Old City Hall building.

The agreement between the lodge and the borough of Lancaster does not include the term “air rights.” And the March 22, 1798, document also doesn’t clearly state that the lodge actually owned the second floor of the building.

But the fact that the county paid the Masonic lodge rent to use its space suggests ownership of the second floor, while the enclosed market downstairs was still owned and operated by the borough.

An early photograph from the 1850s shows Old City Hall at the corner of what is now Penn Square with an entrance on West King Street. The Masonic building next to it, now 7 W. King St., shows what might be the only evidence of arches that led to market stalls on the ground floor.

The site of the current Central Market building at 2 W. Grant St. can just be made out, where wooden open-air stalls stood for vendors to sell their goods.

The future of air rights in Lancaster

It’s unclear if the Queen Street Station Parking Garage agreement is a harbinger of similar deals to come.

Creme said developers run into problems when considering projects on top of existing buildings. For one, he said, most existing buildings are not engineered to take on more load from additional floors.

“But I also think that it’s going to be in peoples’ consideration more frequently now than ever,” Creme said.

The Red Rose Transit Authority’s Queen Street Station Parking Garage at North Queen and East Chesnut streets is an exception to the issue of engineering limitations. When it was designed and built in the 2010s, it included a steel frame that could accommodate additional floors.

A deal was in place for a developer to build luxury condominiums above the Queen Street Station Parking Garage during the project’s development, but the plan fizzled when it attracted few buyers in the wake of the Great Recession. The price for one of the luxury units would have started at just under $500,000, according to newspaper archives.

Now, Eberly Myers wants to build a four- to six-story apartment building on top of the parking garage that would include 70 to 90 studio and one-bedroom apartments, according to Myers.

If the developer can finalize construction plans and financing, it would buy the South Central Transit Authority’s air rights for $790,000, according to the sale agreement. South Central Transit Authority oversees both Lancaster County’s Red Rose Transit Authority and the Berks Area Regional Transportation Authority.

Myers said tenants would have a premium view over the city with excellent sun exposure.

“The views will be great,” he said, explaining that the additional floors would sit above the nearby Holiday Inn Lancaster at 26 E. Chestnut St. and the Lancaster County government building at 150 N. Queen St.