CONCERT’s Post

Office-to-residential conversions are piquing developers’ interest in U.S. cities, despite hurdles related to requirements for seismic upgrades and reviews of plans for historic buildings. Though developers are exploring possibilities in Portland, no conversions have been made in the city yet, reported Finance & Commerce. "Gensler’s 2024 design forecast shows conversions of underperforming office buildings are trending this year. Cities such as Portland desperately need housing, said Maurice Reid, co-studio director in Gensler’s Portland office. Many downtowns have a lot of vacant offices and may see an increase in distressed property sales this year." "In national and international surveys, Gensler has found that people want to be downtown but in vibrant, mixed-use environments. While cities seek ways to activate their downtowns, Gensler has studied how office buildings can be converted into residential ones." https://lnkd.in/gJ7Tvk8e #portland #unitedstates #officeconversion

The reality of converting underperforming office buildings into apartments may be far too challenging for every building or in every market. So, what can be done with these properties other than tear them down? In this week’s post “Housing Not the Only Option for Office Building Conversions,” we explore alternative uses that offer promising opportunities for underperforming properties, leveraging existing structures and contributing to vibrant communities. The office-to-lab conversion market has a successful track record. Although the conversion is expensive, the potential returns are enticing. Conversions to medical office space are not as difficult or expensive as lab conversions, but still come with their own challenges. Medical office space has long been seen as a safe haven for investors due to the stability of the tenant base and cash flow predictability. While converting office buildings into hotels presents many of the same challenges as housing conversions, it can be done, particularly with older buildings with historic character. To learn more about these three alternate use conversions and their advantages over new ground-up developments, read our post at: https://lnkd.in/gfHWnCw4. #voitrealestate #marketinsights #markettrends #officespace #clientadvisor #cre #creindustry #voitrealestate #socalrealestate #sior #ccim

Office-to-residential conversions are piquing developers’ interest in U.S. cities, despite hurdles related to requirements for seismic upgrades and reviews of plans for historic buildings. Though developers are exploring possibilities in Portland, no conversions have been made in the city yet. Gensler’s 2024 design forecast shows conversions of underperforming office buildings are trending this year. Cities such as Portland desperately need housing, said Maurice Reid, co-studio director in Gensler’s Portland office. Many downtowns have a lot of vacant offices and may see an increase in distressed property sales this year.

This is article explores the reshaping of residential spaces through office conversions and presents an intriguing perspective on the evolving dynamics of urban development. As remote work trends continue to reshape demand for office space, the potential to convert underutilised office buildings into residential units emerges as a solution to address the growing housing shortage. However, the article rightly highlights the challenges developers face, including financial constraints and architectural considerations. Successful office-to-residential conversions will require innovative planning and collaboration among stakeholders to ensure that these projects effectively meet housing needs while aligning with community standards. Overall, the potential for office conversions represents a promising opportunity for the real estate market, definitely something to keep an eye on. Read the full article > https://lnkd.in/evBGTFy4 #officeconversion #redevelopment

Insightful article ⬇

New Life for Old Offices: The 2024 Trend of Converting Workspaces into Living Spaces 🏢➡️🏠   As we embrace 2024, a remarkable urban transformation is unfolding. The pipeline of office-to-apartment conversions is rapidly expanding. Office buildings, long-standing symbols of corporate life, are morphing into residential havens. But what do the numbers say about this shift? Let's dive into the data: 1.    Four Years, Four Times the Apartments: The office-to-apartments conversion pipeline has experienced a remarkable fourfold growth - from a modest 12,100 apartments as of 2021 to a staggering 55,300 as of 2024. 2.    Dominant Trend: Office-to-apartment conversions now make up 38% of the 147,000 future adaptive reuse projects, overtaking other building types. 3.    Younger Buildings Selected for Conversion: The average age of #office buildings undergoing conversion is 72 years, notably 20 years younger than their predecessors, hinting at a strategic shift towards buildings with modern potential. 4.    Conversion Hotspots: Washington, D.C. leads with 5,820 units, followed by New York (5,215 units) and Dallas (3,163 units), showcasing a significant step towards urban reshaping. 👉 Want to explore more about future #conversion trends? Dive into our comprehensive report for an in-depth exploration of office-to-apartment conversions and their impact on urban living. https://lnkd.in/eqrJcnew Have you seen this trend in your city? What are your thoughts on this shift? Share your views below. 👇  #RealEstateTrends #OfficeToApartment #AdaptiveReuse #UrbanLiving

An interesting article by Kayla Carmicheal in Bisnow highlighting some recent CBRE & JLL research showing the concentration of office leasing activity in prime office buildings, representing about 8% of the US commercial office market. Some statistics that jumped out to me: - Prime buildings now command a 84%!! lease premium over other buildings - These 8% of buildings have had a net absorption of 48M SF since 2020, compared to negative absorption of 192M SF in the remaining market. - Prime buildings have a 4.9% lower vacancy rate - Buildings built since 2014 have a positive absorption rate, while buildings built prior have a negative absorption rate of 420M SF. The big takeaway for me wasn't new, but was affirming - high quality buildings in dynamic neighborhoods matter, and they will always matter. And there is a significant portion of the commercial office stock that is quickly becoming (or arguably has already become) functionally obsolete. What architects, planners, engineers, building owners, and policy makers do to reimagine these buildings/site will be the fruitful ground for creativity and innovation for many years to come! https://lnkd.in/gHJyRbFV #commercialoffice #architecture #design #cities

“So You Want to Turn an Office Building Into a Home? Here’s How to Solve a 25-Story Rubik’s Cube" The insightful The New York Times article posted in the comments below 👇 delves into the complexities of converting office buildings into housing, addressing a dual challenge many cities face: an oversupply of office space coupled with a critical housing shortage. 1) The Promise of Conversion: Converting office buildings into residential spaces is appealing for addressing urban overcapacity and housing shortages while reducing waste and revitalizing neighborhoods. However, the article notes that this process is complex and not a simple solution. 2) Key Challenges: Each building poses unique challenges, such as regulations on room sizes, window requirements, and structural issues. Access to natural light and fresh air is essential for residential living. The authors highlight that prewar office buildings with operable windows and suitable layouts are generally easier to convert into apartments than modern buildings with deep floor plates and sealed windows. During conversions, hidden issues behind walls often emerge—things that lasers and scanners can’t detect—leading to unexpected challenges and, therefore, the need for more contingency funds and timing buffers. In contrast, with new construction, most surprises arise during land development. 3) Economic Viability: Conversions are appealing but hindered by economic factors, as modern office buildings often have a higher value as offices than residential properties. Effective public policies like tax abatements and relaxed zoning regulations are needed to incentivize developers to make conversions viable for affordable housing. With thoughtful planning and policy adjustments, cities can better position themselves to tackle the challenges of aging office buildings and a growing demand for housing. Remember that the most energy-efficient building is an existing one! 💡 Have you seen successful examples of office conversions in your area? What factors contributed to their success? 🤔 Share your thoughts in the comments below 👇! Please like 👍, comment below 👇, or share 👉. Click the 🔔 in my profile to get notified of my posts. And follow me for more content like this. #home #multifamily #homerental

New Life for Old Offices: The 2024 Trend of Converting Workspaces into Living Spaces 🏢➡️🏠   As we embrace 2024, a remarkable urban transformation is unfolding. The pipeline of office-to-apartment conversions is rapidly expanding. Office buildings, long-standing symbols of corporate life, are morphing into residential havens. But what do the numbers say about this shift? Let's dive into the data: 1.    Four Years, Four Times the Apartments: The office-to-apartments conversion pipeline has experienced a remarkable fourfold growth - from a modest 12,100 apartments as of 2021 to a staggering 55,300 as of 2024. 2.    Dominant Trend: Office-to-apartment conversions now make up 38% of the 147,000 future adaptive reuse projects, overtaking other building types. 3.    Younger Buildings Selected for Conversion: The average age of #office buildings undergoing conversion is 72 years, notably 20 years younger than their predecessors, hinting at a strategic shift towards buildings with modern potential. 4.    Conversion Hotspots: Washington, D.C. leads with 5,820 units, followed by New York (5,215 units) and Dallas (3,163 units), showcasing a significant step towards urban reshaping. 👉 Keen to explore more about future #conversion trends? Dive into our comprehensive report for an in-depth exploration of office-to-apartment conversions and their impact on urban living. https://lnkd.in/eqrJcnew Have you seen this trend in your city? What are your thoughts on this shift? Share your views below. 👇  #RealEstateTrends #OfficeToApartment #AdaptiveReuse #UrbanLiving

More than 1B square feet of US office space deemed viable for residential conversion "A building's age also is an important factor and one of the biggest differentiators between Tier I and Tier II buildings, Ressler said. Building codes largely changed in the 1980s, so office towers built before then may have unique structural considerations — and require additional cost to address those differences — as a result." "The vast majority of the buildings analyzed by CommercialEdge — more than 85% — were deemed Tier III, or least suitable for conversion. The higher interest-rate environment and a tough financing market have become additional wrinkles to making a lot of real estate deals, including conversions, financially feasible. There also remain gaps between what buyers and sellers feel a building is worth, as many groups looking to convert offices into housing or another use are looking to buy those structures at deep discounts." https://lnkd.in/ezpYK6Zr