Are Old Offices the Next Housing Solution?

Converting underutilized offices is one opportunity to address the short supply of multifamily housing. Especially in urban cores, there are numerous buildings that aren’t attracting corporate tenants but could be repositioned as apartments.

Here are three reasons these properties are ready for a new life as someone’s home, plus a look at two projects in Chicago and Philadelphia.

1. Good Bones

There are already established methods for converting warehouses, hotels and schools into apartments, so transitioning an office is not new engineering territory. Look for a building with a shallow floorplate because the exterior walls are a premium for light penetration, ventilation and life safety codes.

“The best distance is 60 to 80 feet, though modern buildings with light wells can work too. Pay attention to the column grid and if it will fall between dividing walls rather than inside units,” noted Michael Brookshier, VP of Development for Keystone.

Older buildings typically possess historic charm with unique architecture details and a compelling story. For example, The Curtis in Philadelphia features a rare Tiffany glass mural. Even the tall ceiling heights common in prewar construction are ideal for apartments.

2. Location

Buildings that are part of amenitized neighborhoods are attractive reuse candidates because they’re already connected to municipal and social infrastructure.

“We’re in a world where work from home is here to stay to a certain degree. Cities have historically been centers of business, yet many now have an office surplus. We can make our urban centers vibrant by adding multifamily so people can live, work and play within a small radius,” stressed Cindy Delein, principal with Stantec.

“Adaptive reuse is an essential part of redeveloping our downtowns,” Brian O'Donnell, Stantec vice president, added. “But not every empty office needs to be fully converted into residential—mixed use also has economic viability. Some combinations are residential with office, hotel or even office and retail.”

3. Sustainability

Much of a building’s embodied carbon is present in its structural steel and concrete. Yet these components are saved with adaptive reuse. Envelope improvements, such as new windows and insulation, and efficient mechanicals also contribute to a better carbon footprint.

“There are even operational gains with power consumption, as an office has huge electrical loads compared to condos running household appliances and computers,” Brookshier noted.

Due Diligence

Not every vacant office is a good fit for apartment conversion. Code complications, historic preservation requirements, energy regulations or a total gut might skew the financial picture.

“Prepare for larger contingences,” Delein advises. “Especially in older facilities, gotchas could be remediating hazardous materials, changing vertical circulation to satisfy code and updating accessibility.”

“Always have more than one reason for preserving the building,” stressed Rick Whitney, VP of FitzGerald. “There is a perception that adaptive reuse is cheaper than new construction, but that’s not always the case. Plus almost every project runs into difficult zoning or code issues. Be prepared to meet with the building department early to identify and resolve challenges from the beginning.”

Millennium on LaSalle (Chicago)