Are office-to-residential conversions worth it?
A question we’ve noticed in the headlines recently: What will happen to the office buildings sitting empty? There’s a lot of potential for office-to-residential conversions, but skeptics are quick to point out the many challenges. Floor plans are tricky. Not enough natural light. And it’s expensive.
But conversions aren’t new and there are successes. In Chicago, the historic neo-gothic Tribune Tower was converted into luxury condos. Detroit’s restored Book Tower offers “landmark living” with apartments and hotel rooms. The Mayer Building office space in Los Angeles is on its way to becoming affordable housing.
Office towers bustling with commuters by 9 a.m. and emptying out by 5 p.m. isn’t a reality most cities have come back too. So what happens next?
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In New York, the mayor’s office has made conversions a top priority with new tax incentives and zoning changes. Turning offices into housing could refresh neighborhoods that are suffering due to the lack of commuters and provide crucial additional living space. In an ideal world: New housing means new residents, which leads to better restaurants and retail tenants, and then eventually public parks, wider sidewalks, and more bike lanes. Developers in New York point to the rebuilding of Lower Manhattan after 9/11 as an example of how office conversions can bring not only more units but also a neighborhood transformation, according to the Financial Times. Back then, city leaders made conversions a priority and developers got help from federal financial incentives, too.
The bottom line: Office conversions are challenging, yes. Some buildings are better suited than others. But tax incentives, flexible zoning, and the rising demand for housing are positive signals for a transformation.
For more:
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