Office To Community Conversions All-Time High in 2022
Multifamily News
Los Angeles is leading the nation in adaptive reuse construction with 1,242 new units delivered and 4,130 more under construction – the best year in the city’s history. The effects of the pandemic have left many companies closing their offices and opting for a remote work environment. In turn, the number of abandoned buildings has prompted a new opportunity for office spaces to be converted into housing units.
Important Office to Apartment Conversion Statistics
A RentCafe report found that apartment conversions have risen 25% in the two years since the start of the COVID-19 pandemic. In the same time period, there was only a 10% increase in new apartment construction.
Office-to-apartment conversions made up 11,090 of those units, up more than 40% between 2020 and 2021 – an all-time high, according to RentCafe. In turn, a total of 77,000 adaptive reuse units are currently in the process of being converting into communities.
Overall, RentCafe projects that 28% of its 77,000 conversion projects are office conversions. On the other hand, the second largest share belongs to hotels, with 22%, followed by factories, with 16%.
In 2022, conversion activity hasn’t slowed down; as of July, 8,300 new adaptive reuse units were open for occupancy.
Between 2020 and 2021, 15% of all adaptive reuse projects nationwide were completed in Washington, Philadelphia, and Chicago. Additionally, there were 1,552 newly converted apartments in Philadelphia during this period, while there were 1,139 new apartments constructed in Chicago.
The Future of Multifamily Housing
The construction of new multifamily communities and the repurposing of an office building for apartments proves there is a bright future for the multifamily housing sector. With a clear lease-up strategy communities can expect to fill in units fluidly.
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