What is Floor Area Ratio in Real Estate?

FAR stands for the Floor Area Ratio which is also known as the Floor Space Index (FSI) in other parts of the world.

Technically, it can be defined as the total floor area (collecting the area enclosed by all the floors in a building) divided by the total area of land on which the plot is being constructed.

In short, FAR = Gross Floor Area / Total Area of the Land

Floor Area Ratio (FAR), also known as Floor Space Index (FSI) or Floor Space Ratio, is a planning tool used in real estate and urban development to regulate the size and density of buildings on a given piece of land. FAR represents the ratio between the total floor area of a building and the total area of the plot on which it is constructed.

FAR is typically expressed as a numerical value, such as 2.0, 3.5, or 5.0. This value signifies the maximum allowable floor area that can be constructed on a specific plot of land relative to its total area. For example, with an FAR of 2.0 and a land area of 10,000 square feet, the maximum floor area that can be developed on that plot would be 20,000 square feet.

The calculation of FAR considers all floors of a building, including both the occupied and unoccupied spaces, such as apartments, offices, storage areas, stairwells, and basements. It helps determine the overall density and intensity of land use in a particular area. A higher FAR allows for more built-up space, resulting in taller and denser buildings, while a lower FAR restricts development and promotes open spaces.

FAR regulations are typically set by local planning authorities, zoning ordinances, or building codes, and they vary across different jurisdictions. They are often used to control and manage urban growth, maintain a balance between population density and available infrastructure, preserve open spaces, and ensure proper land utilization. Developers and architects need to adhere to the specified FAR limits when designing and constructing buildings to comply with the local regulations.