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As cities and suburbs across the country continue to struggle with vacant office space thanks to the popularity of remote work, developers are increasingly converting their office buildings into residential communities, Stateline reports.
Thanks to tax breaks from the state and local zoning changes, some cities are turning their unwanted cubicle farms into much-needed housing.
“Office vacancy has climbed to a 30-year high and at the same time there’s a housing shortage. So naturally the question is, ‘Why can we not convert all these vacant office buildings into housing?’” says Jessica Morin, research director for CBRE, a commercial real estate firm. CBRE research shows converting offices to other uses—mostly housing—is set to peak this year at more than 20 million square feet, up from 6.3 million in 2021.
Nationwide, 119 office conversion projects, including for residential and other use, are under construction or were completed this year—the most since CBRE began tracking them in 2016. Those projects could add about 44,000 new housing units when completed.
Since 2016, projects representing 125 million square feet of offices have been or are slated to be converted to other uses, usually to housing but sometimes to warehouses or laboratories. But despite the recent increase, that represents only about 2% of all U.S. office space.
Locally, developer Mike Wampold recently renovated the Chase South Tower off Florida Street in downtown Baton Rouge into a multi-use property, with the top 12 floors of the building being renovated from commercial offices into residential apartments.
