Conversion of offices to multi-family residential is the answer.
Traditional downtowns have a vacancy problem. Workers abandoned traditional offices and there’s no sign they’re coming back.
More and more employers are embracing remote or hybrid work and office buildings in major US cities are experiencing the highest vacancy rates in roughly 30 years.
Roughly a quarter of downtown offices are vacant. And that is going up.
Covid accelerated the trend of US employers using less office space and the number of square feet needed per white-collar worker has steadily declined in recent decades.
37% of current office space in our country is likely to be abandoned as workers switch to remote work. That could slash cities’ tax revenue and economic activity. A study of eight cities found that lost tax revenue from commercial properties could lead to budget deficits of between 5% and 7%.
Faced with an avalanche of vacant office space and a willingness to face reality, some towns and cities are beginning to allow and even encourage the conversion office space to multi-family residences.
The good news is there’s high demand and low supply of moderate priced housing. Office workers may never flock back to urban areas, but they may stampede to extremely needed housing, that comes with the plus of walkability and nightlife.