HR&A Advisors’ Post

Something like 20,000 new residential units will be hitting the NYC housing market over the next 10, or so years with roughly 2,100 units already in process. These units will be contained in 64 former office properties as part of NYC's Office Conversion Accelerator Program. Currently 18% of NYC's office properties are vacant and the OCAP will give owners the ability to hopefully convert their lemons into lemonade while also offering New Yorker's some housing relief from the current 1.4% Vacancy Rate in the City. The OCAP "is supposed to serve as a one-stop shop to help building owners navigate complex rules and building codes by connecting them with representatives from various city agencies." This may not appear to be much, but in a City where the rules and regulations surrounding rehabs and new construction are complex, to say the least, its something. All I can say is BRAVO for the new units and for the City wakening up to help the industry that has helped make and maintain NYC as what I consider to be the greatest city in the country if not the world. #CRE #RealEstate #CommercialRealEstate #NYC #CREFinance #RealEstateFinance #CommercialRealEstateFinance #NYCOfficeConversionAcceleratorProgram https://lnkd.in/e3iDquyN

HUD is spending nearly $4M to research U.S. housing supply and office-to-residential conversions. They're bankrolling several key research groups to help crack this significant challenge, focusing on prefab construction, economic forecasting, local regulations, and and other methods to transform aging city buildings into livable spaces. Marcia Fudge at HUD is stirring the pot to alleviate the tight housing market. She's on the right path—transforming outdated business districts into dynamic, mixed-use neighborhoods. HUD is allocating funds to some sharp minds like the National Institute of Building Sciences, initiating projects for faster, more cost-effective housing solutions. Meanwhile, the University of California team has been awarded $458,340 to investigate how ADU regulations are impacting rents and property prices across California, and how these changes affect land values, even when new housing options remain untapped. Plus they've allocated a significant $900K to Gensler to probe how swapping offices for apartments could play out across different urban settings. This is huge – it's not just a facelift for old buildings; it's about the government really stepping in with funds to tackle the big issues. Turning empty offices into living spaces is a game-changer, making cities more livable and vibrant. This funding isn't just cash; it's a blueprint for the future, turning today's challenges into tomorrow's solutions, making our cities better for everyone. #HousingInnovation #HUDGrants #OfficeConversion #UrbanRevitalization

Office to residential conversion is not easy, but I believe it represents a HUGE opportunity to help address our housing crisis! So, less we forget, the easiest option is often not the best one… and if it was easy, EVERYONE would be doing it! BIG rewards go to those who do the HARD work! #housing #housingcrisis #housingforall #officeconversation "When all the key players understand the project’s vision and concerns early on, it greatly facilitates the execution of the plan." https://lnkd.in/gx2FyMsK

Could SF's office-to-residential pivot solve its housing crisis? 🏢➡️🏠 With a 30% vacancy rate and buildings in the Financial District selling for less than $200 per square foot, the city's "class B and C" offices are prime for transformation. Moody's Analytics identifies 13% of SF's historic offices as potential homes, signaling a significant urban makeover opportunity. 🌆✨ Despite this, SF hasn't made the top 20 cities for conversions. The Warfield's shift to apartments showcases what's possible, and a recent city initiative drew interest from eight landlords, aiming to create about 1,100 units. Could this mark the start of SF's conversion wave? **Takeaway**: With key buildings at historic low values, SF's office-to-residential conversions could be the key to unlocking its housing potential. #SFRealEstate, #HousingInnovation, #OfficeToResidential, #UrbanRevamp, #SustainableCities, #RealEstateTrends, #WarfieldBuilding, #AffordableLiving https://lnkd.in/gy9CxwMj

Boston is dominating the office-to-residential conversion news this week. This KS Partners $36M, 95-unit Downtown Crossing deal is huge for the trend - the biggest incentivized adaptive reuse project in Boston so far. But the real significance goes beyond just size. This deal reinforces the immense pricing dislocation opening up between CBD office valuations and the intrinsic multifamily redevelopment potential of those same assets. KS's Downtown Crossing deal is likely just the opening act as institutional capital starts rotating out of office exposures into tactical residential conversion strategies and vehicles. The valuation gap between CBD office pricing and multifamily rental growth is too glaring to ignore for long. From a housing policy perspective, this could be transformative. Conversions at scale could help cities address rental housing shortages by unlocking new supply pipelines from the massive existing office footprint. And public-private partnerships like the Boston tax incentives can further catalyze that adaptive reuse. Municipalities facilitating more of these kinds of conversion projects through zoning reforms and tax incentives could activate significant new rental inventory without overheating construction pipelines. A potential two-for-one repricing of urban property values and housing stocks simultaneously. #BostonRealEstate #OfficeToResidential #AdaptiveReuse #KSpartners #DowntownCrossing #RealEstateTrends #HousingPolicy #MultifamilyDevelopment #UrbanTransformation #InvestmentOpportunity #ContrarianInvesting #RealEstateConversion #ValuationGap #RentalHousing #PublicPrivatePartnership #TaxIncentives #ZoningReform #UrbanDevelopment #HousingShortage #RealEstateInnovation #MunicipalStrategy #PropertyRepricing

New York City's real estate sector is adapting to changes, especially in the wake of Gov. Kathy Hochul’s unclear stance on the 421a tax incentive replacement. Mayor Eric Adams's administration launched the Office Conversion Accelerator program in August, with 46 buildings currently enrolled. This initiative facilitates the conversion of office spaces into residential units by easing restrictions and simplifying the rezoning process for building owners. Already, work has started on four buildings, potentially adding 2,100 housing units. Notable projects include major overhauls at 25 Water Street, 90 John Street, 17 Battery Place, and 160 Water Street. The program is part of the city's broader efforts to address the housing shortage and rejuvenate central business districts by converting vacant office spaces into various types of housing, including affordable homes and dorms. The Adams administration is also working to rezone parts of Midtown to further enable office-to-residential conversions. The urgency for such transformations is highlighted by the increasing vacancy in Manhattan office spaces, reaching 77.8 million square feet in the fourth quarter of 2023, up from 69.9 million square feet in the previous year. #NYCRealEstate #HousingCrisisSolutions #OfficeConversionAccelerator #UrbanTransformation #ResidentialDevelopment #ManhattanRezoning #AffordableHousingNYC #RealEstateInnovation #MayorAdamsInitiative #NewYorkHousingFuture https://lnkd.in/e2SWmpHr

The City of Seattle's new legislation to ease #officetoresidentialconversions is a bold move to address the city's #housingshortage. By relaxing design standards and #affordablehousingrequirements, the city is hoping to incentivize developers to create more housing units in underutilized commercial spaces. However, the projected impact of the legislation seems relatively modest, with only 1,000 to 2,000 new units expected over seven years. This raises some questions. Is the incentive enough to truly spur a wave of conversions? Could the city be doing more to encourage developers, such as offering additional #financialincentives or streamlining the approval process? Additionally, while the focus on increasing #housingsupply is commendable, the lack of #affordablehousing requirements is concerning. This could exacerbate existing #affordability issues in the city.

Work from home in your former office building may be an option soon. This seems like a good solution for all the vacanct commercial real estate as well as a solution for the housing crisis. https://lnkd.in/dcJqnK-2

Tuesday Newsday v.8.20.2024 In the land of mega office builds for Tech companies, San Francisco is changing up its strategy and is...loosening development regulation? After having the bottom fall out for Office space demand over the past few years in the downtown area of San Francisco, it appears the local government representatives are having a wakeup call. Recent legislation proposed by officials would remove the zoning requirement imposed onto developers to have a minimum amount of the mixed-use buildings be dedicated to Office space. Is this the Free Market winning out? Well, I can answer that - Yes, it is, and the answer is to have more Multifamily. If you are looking for help with you Multifamily Investments, give me a call. Hunter Rupp / 567.290.2012 / Hunter@EncoreREIS.com Encore Real Estate Investment Services #TuesdayNewsDay #OfficeToMultifamily #Multifamily #CommercialRealEstate #RealEstateInvestments https://lnkd.in/g4Pa8mxH

Urban downtown office-to-residential conversions (OTR) are trending in major East Coast cities like Boston, New York, Philadelphia, Washington, D.C., and now – Pittsburgh. Explore this Bohler article discussing the advantages of taking on a conversion project and the factors at play that make the region well-suited for this type of development. Read it here: https://lnkd.in/eAXM9UCC