The national pipeline of office-to-residential conversion projects has crossed 50,000 units for the first time, according to a study from RentCafe, driven by a federal tax incentive introduced last year and zoning reforms in several gateway cities.
New York, Washington DC, Chicago, Los Angeles, San Francisco and Dallas together account for roughly two-thirds of the national pipeline, reflecting both the depth of office distress and the relative ease of local approval processes in those markets.
Economics
Developers say only a minority of distressed office stock is physically suited for residential conversion, given floor-plate depth and window-line constraints, meaning the pipeline growth still represents a small fraction of total vacant office square footage.