Fast Fourier Transform (FFT) is the basic building block of (Orthogonal Frequency Division Multiplexing) OFDM system. The overall efficiency of the OFDM system depends on the rate at which significant volume of data is processed by the FFT. This paper proposes a customized floating point butterfly unit used in the design of FFT which is the arithmetic kernel of OFDM system. Customized floating point data format with reduced number of bits compared to the IEEE 754 standard can be used. This in turn reduces the overall power and area of the system. The dynamic range offered by the proposed floating point format satisfies the dynamic range requirements of 16QAM and 64QAM. This paper focuses on the development of customized floating point unit. Then the results of the conventional radix 4 and radix 8 butterfly units are compared with the butterfly units designed using the proposed fused floating point unit. Considerable saving in area is achieved in the proposed radix 4 and radix 8 butterfly units.