Some buildings are in the pipeline, just waiting for approval, but many cities need to do more improving of infrastructure, cleanliness and safety in order to thrive. In a sign of good news, more office-to-residential conversions have developed in cities as distinct as Cleveland, Houston and Washington, D.C.
The West Coast has some catching up to do.
Places like Northern California and the Pacific Northwest are starting to pivot to incentivize this kind of work, Michael Great, design director of architecture at Portland-based Ankrom Moisan, told the Free Cities Center.
“Converting office to residential is the most sustainable thing you’re going to do,” Great said. “There’s not as much going into landfills, so it’s highly sustainable.” In any city, Great noted that key considerations come down to regulatory feasibility, design and economics.
Often a “Rule of Six” is applied when gauging which buildings can be adapted for residential use. What neighborhood it’s in – and its walkability within the city – often comes first. Then in design terms, is it a Class B or C office building and when it was built, what are the floor-to-ceiling heights, are the floor-plate sizes (square footage) at least 12,000 feet, and is the core-to-façade depth less than 45 feet?
Conversions on the West Coast are somewhat limited, Great said, with California leading the way due to nuances in the seismic requirements. For example, in California seismic codes accommodate high-frequency, low-intensity events, lowering conversion costs. In the Pacific Northwest, codes are designed for rare, high-intensity events, increasing expenses.
In Portland, conversion feasibility also has been hindered by flat or declining rents, Great added, though many clients anticipate improved financial conditions in one to three years. Elsewhere, East Coast and Midwest cities benefit from fewer seismic concerns, improving their viability for conversions.
Although New York City has been adapting offices to residential use since the 1990s, and empty nesters nationwide were rushing back to cities from the suburbs for a while, the pandemic and crime rates have made downtown living less viable for some.
What hasn’t subsided: middle-class residents needing fair market-rate or affordable housing units close to major transportation hubs and other urban amenities. That’s prompted new office-to-housing conversion growth in Dallas, Columbus and other Southern and Midwest cities. In Madison, Wis., politicians have openly admitted to zoning law issues that have hindered new “missing middle” housing.
There are several examples of adaptive reuse buildings in Los Angeles, but fewer in San Francisco. It can be chalked up to cost, but also to regulations and earthquake safety requirements. Still, study groups have found there are good candidates for adaptive reuse in the Bay Area. After all, safety codes apply whether it is office or residential construction.
A new project at 785 Market Street, is set to turn to the former Humboldt Savings Bank building into residential units. Ten years ago also saw the completed conversion of 100 Van Ness Street, and Mayor Daniel Lurie wants more move-in ready units as part of his downtown economic revitalization plan. Reports have found between 13% and 40% of San Francisco’s downtown buildings are solid conversion candidates.
Voters have backed such efforts with Prop C, passed in March 2024, which provides one-time transfer tax exemptions to owners who sell a commercial property for residential use. Seattle and Portland also have strong support for such projects. When voters were asked to renew Seattle’s Housing Levy in 2023, they did so two-to-one. A developer has filed an early plan to convert the 14-story Vance Building into apartments.
In 2023, the Portland City Council took steps to help ease the conversion of office space to housing, with a limited exemption from development fees when undertaking certain seismic retrofits. After all the recent wildfires, living in cities may become a better option than rebuilding in areas of overgrown underbrush on hillsides.
Meanwhile, Yardi’s Conversion Feasibility Index found that in Los Angeles and San Francisco one in five buildings is suited for office-to-residential conversion, versus 14.8% nationwide.
Seattle and Portland also made a strong showing in the index, which weighed the viability of office buildings for residential conversion by considering a structure’s location, age, size and green-building certifications.
The Yardi’s Index found 4% of San Francisco buildings are Tier 1 candidates for conversion (highly feasible) and 16% are Tier II (somewhat feasible); the city planning department in 2023 also issued a Request for Interest for converting downtown sites.
So with so many cities on board, and housing need so acute, why isn’t it happening faster?
“It’s purely the economics, getting rents to balance the construction costs, and other regulatory feasibility,” Great said. And there are different perceptions about downtown environments.
“We talk about this with all three of the cities we have offices in, it’s security issues, homeless; issues we hear about on the news all the time,” Great said. But it can be done; his firm led the way in converting Portland’s Pearl District from industrial to residential and retail.
The state of California has pressed for adaptive reuse conversions, via passage of Assembly Bill 2011 and AB 6, in 2022, though Gov. Gavin Newsom vetoed other measures (AB 2910 and AB 3068) in 2024. In a veto message for AB 3068, Newsom said he supports adaptive reuse to address the housing crisis but said the bill raises other concerns for “labor standards,” which seem unclear.
Smaller San Francisco properties, including the Diva Hotel at 440 Geary Street, have been turned into apartments. “Office-to-residential conversions are inherently complex, requiring collaboration with developers and policymakers to overcome regulatory, financial and design barriers,” Great explained, adding that a unique opportunity lies in unbuilt office projects stalled in the permitting process.
“These buildings, already close to meeting residential code requirements, may be excellent candidates for redesign as housing,” Great said. “Exploring such possibilities could unlock substantial value in addressing housing needs.”
Sarah Downey is a journalist who covers political and social policy. She’s reported for Newsweek, the Chicago Tribune and Boston Globe in the United States and overseas.
