The ADRR

The rise in remote work caused by the pandemic has sparked considerable interest in converting older and less competitive downtown office buildings into residential uses. Many downtowns have a rich history in successfully making such conversions, and those new to such ventures can certainly learn much from them.

For example, the transformation of lower Manhattan really began in the mid-1990s when Carl Weisbrod formed the Alliance for Downtown NY BID with the stated purpose of converting thousands of square feet of vacant office space to residential and early tech use. It just so happened that the obsolete and vacant 1920s inventory laid out remarkable well for housing. 9/11 was indeed a disastrous set-back, but they already had a growing residential population to rebuild from. Carl certainly inspired us here in Philadelphia and we quickly passed a 10-year tax abatement bill in 1997 for the explicit purpose of converting vacant office and industrial buildings to residential use. This was largely an inventory built between 1885 and 1932. We are now approaching 200 such buildings converted in the core of our downtown to either housing or hotels. The same inventory has been converted in cities as diverse as Baltimore, Cleveland, Chicago, St Louis, Dallas, Minneapolis and Los Angeles.  I think a real issue today may be that not all 1980s and 1990 office buildings convert as easily as the 1880s-1920s inventory that, even when steel framed, had much higher ceilings, larger windows and heavy concrete floors. The masonry load bearing structures are even better for housing, for tech and now lab space. Philadelphia is a slow growth city that rarely explodes with new office development the way San Francisco and Seattle do. Sometimes it may help to be a tortoise.

For those wanting more detailed information about such conversions, CLICK HERE for the 1996 analysis that we did of older buildings. CLICK HERE  for the 1997 tax abatement bill that resulted from that analysis