Office Conversions Kill 2 Birds With One Stone In Dallas' CBD And Beyond

[DCReid]

"Conversions to multifamily are beginning to put a dent in office inventory in Dallas’ central business district, with more than 2M SF of vacant space coming off the market in the coming months...Dallas isn't the only city where a changing office market and tight housing supply have created strong demand for conversions. In New York’s Financial District, Silverstein Properties and Metro Loft are turning 55 Broad St., a largely vacant office building, into more than 500 apartments.

Some half-dozen office-to-residential developments have started in Washington, D.C., in the last two years, while officials in Chicago recently released a plan to provide incentives for developers revitalizing the city’s iconic LaSalle Street, which is dealing with 5M SF of vacant commercial space.

Nationwide, adaptive reuse projects have delivered about 32,000 new apartments since the start of 2020, 41% of which are in former office buildings, according to RentCafe. In 2021, roughly 7,400 apartments were created via office conversions.

Despite their growing popularity, some submarkets are better suited for conversions than others.

The Dallas CBD has a large concentration of towers built in the 1970s and ’80s, a time office development was surging and new builds often exceeded 1M SF.

The size and age of those buildings have rendered them largely unable to compete with newer properties, especially as companies prioritize quality above all else..."

https://www.bisnow.com/dallas-ft-wor...las-cbd-116050

[bnk]

I posted this in a similar thread. I would be interested in seeing the floor plans. Chicago has does this before. 55 east Monoroe.

Originally Posted by Steely Dan

the towers being discussed here are giant old early 20th century behemoths:



135 S Lasalle | 1934 | 1.3M SF


source: https://www.skyscrapercenter.com/bui...onal-bank/3149



175 W Jackson | 1912 | 1.4M SF











https://www.chicagobusiness.com/arti...ffice-building

This does not name a buildings but mentions LaSalle st.



https://newsried.com/chicago-convert...to-apartments/

Chicago to Convert Famous Business District Office Buildings to Apartments.

4. October 2022

Chicago is providing financial support to developers willing to convert aging office towers into residential buildings. This is a new program that could become a test case for other cities looking to promote the remodeling of these offices.

City officials last week offered tens of millions of dollars in grants to replace the LaSalle Street corridor, a landmark office complex that has thrived as Chicago’s business hub for decades. announced to be activated. But since the pandemic, the strip’s mostly empty streets and towers have come to symbolize the slow pace of employees returning to office buildings.



...


Still, as the pandemic and new workplace patterns have caused office building prices to plummet, conversion projects are starting to look more attractive to developers.

...

The office transformation is part of a broader revitalization plan for Chicago’s LaSalle Street.


Developers planning to repurpose along Chicago’s LaSalle Corridor will benefit from lower office prices. According to data firm CoStar Inc., three buildings are for sale, and the remaining six or so are either in default on their mortgages or have been foreclosed on.

“We have a very unique opportunity to acquire affordable properties for redevelopment,” said Chicago Deputy Mayor Samir Maekar.

Featured in movies like “Ferris Bueller’s Day Off” and “The Untouchables,” LaSalle Street is best known as the historic home of the Chicago Board of Trade and the city’s largest banks and law firms. Even before the pandemic, when some of the larger tenants moved into new buildings along the Chicago River, the Corridor began to decline.


...

The office transformation is part of a broader plan to revitalize Chicago’s LaSalle Street, repurposing the building’s lobby for culture and entertainment, and attracting groceries, restaurants and other residential-oriented retailers. included.

...

Write to Peter Grant at peter.grant@wsj.com.

[bnk]

55 E Monroe. Top floors of an older office tower. Great location but some of the floor plans look narrow.

https://www.chicagometroarearealesta...chicago-il.jpg


https://www.55emonroe.com/p/1

That link is for the Office component but There's a condo link too but I think it shut down because all of the units sold out years ago. Now they are on the private market.


https://www.chicagocondofinder.com/t...php#gotorefine


The corner units are nice, but the middle ones are long and deep.


https://www.google.com/search?q=the+...te3hTMvPOv2kkM

[LosAngelesSportsFan]

Half of downtown LA is basically early 1900s office buildings turned into lofts / apartments / condos with more coming online often. We are now seeing a big number of these in Koreatown and some in Hollywood too

[ardecila]

The Loop is the most transit-accessible place in the US except for Manhattan. It's the natural place for large concentrations of office. Converting to residential just means offices move to less accessible locations and more people driving to work, at a time when we're dealing with global warming and alarming levels of traffic deaths.

The big success story in Chicago is Fulton Market, but that is certainly a place where lots of people are driving to work. New towers include significant amounts of parking compared to similar buildings in the Loop. The one saving grace is that many workers live in the surrounding residential neighborhoods and they can walk or bike to work. But transit is basically just a single L stop and ridership there is mediocre at best.

[cabasse]

how timely. this was recently announced for atlanta's 2 peachtree, a 40 story building built in the 60s and the city's tallest until the westin peachtree plaza was built. i used to walk by this tower coming out of 5 points on the way to class at GSU.



https://atlanta.urbanize.city/post/d...ee-street-redo

[mhays]

They'd stay office if they could. Nobody is going to spend hundreds of dollars per square foot PLUS years without rent on a whim.

The trend has been minimal in Seattle so far (actual or in entitlements), possibly because office owners are too optimistic. But the office numbers are starting to look bad on a non-temporary basis, particularly since new office buildings are still breaking ground. I expect to hear about more proposals in the coming months.

Tacoma on the other hand has already converted one of its tallest buildings and two of the other tallests are planning the same.

[mrnyc]

Originally Posted by mhays

They'd stay office if they could. Nobody is going to spend hundreds of dollars per square foot PLUS years without rent on a whim.

The trend has been minimal in Seattle so far (actual or in entitlements), possibly because office owners are too optimistic. But the office numbers are starting to look bad on a non-temporary basis, particularly since new office buildings are still breaking ground. I expect to hear about more proposals in the coming months.

Tacoma on the other hand has already converted one of its tallest buildings and two of the other tallests are planning the same.

cleveland has been doing this for years.

its bound to happen everywhere to some extent until the new times office work world becomes clearer.

[nito]

Conversion of warehouses is not new in many countries, but in the UK – starting about a decade ago – there was a change in permitted development rights which saw a sizable increase in the conversion of post-war office developments. It was hoped that vacant office space would be better utilised as housing, which makes sense in a market that maintains a persistent misalignment of supply against demand. There are however lingering concerns that the policy change is not creating much additional supply, creating further distortions in the (office and residential) market, and quality is also a long-term concern. Since 2015, 54,000 homes have been created from post-war office developments.

Post-pandemic, vacancy rates in the city core are still very low by North American standards so most of these office-to-resi conversions have been in commuter towns and regional centres orbiting London. Harlow with a population of 93,300 is a post-war commuter town north of London; a staggering 51% of new homes delivered in recent years were through office conversions. Other similar settlements in the commuter orbit of London saw a lower, but still sizable >25% of new homes delivered through these conversions. Much could be said that not enough homes are being built, and that the conversion of offices is merely a quick way to deliver units and meet targets.

[dchan]

As I mentioned in another similar thread, these office-to-residential conversions work best through slimmer office buildings. This is due to residential building code light and air (L&A) requirements for living areas (living rooms, bedrooms) as well as bathroom & kitchens (though these L&A could be bypassed through building exhaust vents). For slimmer office buildings, this means that most (if not all) of the usable floor area can be converted to legal apartments. Whereas for bulky buildings, much of the interior areas of the massive floor plans could not be legally converted to residential apartments.

[dchan]

So You Want to Turn an Office Building Into a Home?

Cities are eager to do this amid rising remote work. But it’s harder than you might think.

By Emily Badger and Larry Buchanan


There’s an appealing simplicity to the idea of converting office buildings into housing. The premise suggests cities could solve two problems — an office glut and a housing shortage — at once. In the process, they could limit the waste of demolition, create new homes with minimal opposition, and renew neighborhoods without radically changing how they look from the sidewalk.

The idea, however, is less like a sweeping fix and more like a set of intricate puzzles — a different one for each building. Each one must solve for local rules that say what counts as a bedroom, for structural columns and elevator shafts that shape where walls go, for construction costs and land prices that affect rent rolls. And they must solve, above all, for access in every unit to fresh air and sunlight.

For many offices, this puzzle may be unsolvable, at least for now.

But for others it is not impossible, even in large modern buildings, even on pricey Manhattan land. And to understand the potential of conversions — and why older buildings often make easier ones — it’s useful to look closely at a pair of buildings constructed 40 years apart, and the evolution of the American office that runs through them.

This NY Times article basically reiterates my points in regards to converting office buildings to residential buildings. In essence, the pre-WW2 office buildings are the best candidates because they were built in an era when office buildings mimicked the lighting & ventilation needs of residential buildings. That is, both residents and office workers needed natural light & air, which comes from operable windows situated no more than 30' from any part of a living room, bedroom, or office space.

Post-WW2 buildings saw advances in central HVAC systems and fluorescent lighting, which allowed the design of office buildings with huge footprints. There is no code requirement for office workers to have access to natural light while working, and the HVAC systems provided the fresh air and heating/cooling functions.

One solution to this conundrum to convert massive Post-WW2 office buildings is to create a 'courtyard', essentially a large lighting shaft between columns. This was mentioned the other thread. Regardless, these conversions tend to create apartments with awkward layouts, something you can see visually in the article.

Free link below to article (no subscription required):

https://www.nytimes.com/interactive/...smid=url-share

[craigs]

According to the Los Angeles Times, LA's first big wave of office-to-housing (and office-to-hotel) conversions began after the city passed an adaptive reuse ordinance in 1999 making such conversions easier. The result was about 15,000 new housing units downtown.

Across Los Angeles County, the Rand Corporation identified 2,300 underutilized office and hotel properties that could be converted to housing, "most of them older office buildings with big chunks of unrented space." If all the underused buildings were converted to housing, it would add as many as 113,000 units, and most of those would be in downtown and Koreatown, which are walkable and well-served by bus and subway lines.