Michael Robbins’ Post

Unless government participation is part of a deal, ground up multifamily construction is just less expensive and more efficiently built versus converting office to residential. Most office building floor plates are too large/deep to break up to attractive residential units. Additionally, the infrastructure (plumbing, electrical, etc.) all has to be redone. Hard to pencil is the bottom line.

Office to Residential Conversions - Not as Simple as it Seems! Over the last couple of years (as I saw 15 years ago during the last downturn), I've seen a surge in interest and fielded a number of calls about converting vacant office buildings to residential units. While it's an exciting idea to address both California’s extreme housing needs and vacant spaces, it's crucial to dispel some common misconceptions and highlight the challenges involved. Myth Busters: 1) It's a quick fix for empty offices: Think again! Feasibility studies, zoning approvals, and construction itself can take years, making this a long-term play. 2) It's always cheaper than new construction: Not necessarily. Extensive plumbing, electrical, and life/safety upgrades can bring costs close to or exceeding building a new property from scratch. 3) Any office building can be converted: Location, layout, depths of floors (from corridor to window) and building features significantly impact feasibility. Not all structures are created equal for residential living. Challenges to Consider: 1) Zoning hurdles: Local regulations might not permit conversions, requiring variances and community buy-in. 2) Financial viability: Careful market analysis is crucial to ensure sufficient demand and rental rates justify the investment. 3) Building limitations: Older structures might lack essential elements like natural light, proper ventilation, and efficient layouts for multiple units. The Bottom Line: Office-to-residential conversions hold potential in extreme and rare use cases, but it's a complex undertaking. Seek expert guidance from experienced brokers, architects, and engineers to navigate the intricacies and ensure informed decisions. Have you seen any interesting office-to-residential projects recently? #sacramentorealestate #officeconversion #housingmarket #development #commercialbroker #sacramento #cre #commercialrealestate Turton Commercial Real Estate

Great tips for Calgary real estate developers seeking to convert offices to apartments. According to researchers at New York University and Columbia Business School, office to market rental conversions can give financial IRR of 16.8% and affordable rentals an IRR of 12.1% if following parameters are followed: 1. Focus on Location of building 2. Over 33 year old buildings 3. Underused A-,B, and C buildings 4. More than 25,000sf buildings 5. Less than 60ft from windows to core 6. None or few long term leases #multifamily,#housing,#affordablehousing,#apartments,#officebuildings,#contractors,#designers,#architects,#buildingleaders,#adaptivereuse,#ownersrepresentative,#seniorshousing,#realestatedevelopment,#realestatecanada,#realestatedeveloper

Maybe it's the recency bias of multiple cataclysmic events but I've been surprised how quickly whole sector demand can evaporate, e.g. office in the pandemic; studios leading up to and during the strike. Such macro-level events can make buildings undesirable overnight despite being built to last 100 years. After converting industrial to studios for several years AND since we're now working on an incredible office-to-residential project (more on that later 😉), we at The Cooperative LA see first-hand the challenges with building floorplates and utility infrastructure complicating a building's pivot to new uses. Unfortunately, a building code limiting floorplate dimensions just seems like one of those moves that would backfire with unintended consequences. Additionally, I don't see developers overbuilding on infrastructure to make it easier for a future owner to one day convert the whole building use. I believe the problems with converting buildings will not get easier. However, they will get more efficient as more and more expertise gravitates to these conversions and the construction community's best builders continue to execute them. #ConstructionIndustry #Development #AffordableHousing #OfficeToResidential #LosAngeles

Over 122,000 new #apartment units converted from other building uses in the U.S. pipeline today, with Los Angeles leading the way. It will be very interesting to see if more markets follow suit and there is an uptick in office-to-residential conversions. #multifamily #commercialrealestate

I have had a lot of conversations recently about what do we do with empty office buildings. Converting to apartments or condos always seems to be part of the conversion but the truth is that it is extremely challenging to do from a construction perspective. Let alone zoning and what to do when the building is still 50% occupied like a lot of properties are. In the long run I think we will see demolishing to start from a clean slate as a viable options for buildings that become fully vacant as leases expire. The future of office is still going to take quite a while to fully shake out but could some great opportunities for those willing to take on the projects. Swope Lees Commercial Real Estate, LLC Bisnow #commercialrealestate #futureofoffice #buildingconversions #demolition #realestatedevelopment https://lnkd.in/eVMkKbTJ

Utilities across the nation are proposing tax breaks and other financial incentives for developers to help revive central business districts by converting vacant office buildings into residential apartments, condos, or mixed-use projects. It’s not as easy as it seems. #EverFab #manufacturing #buildings #construction #realestate #design

I hear all of the so called experts in this space. From those that understand the industry and how buildings are built, this is not impossible, but at what cost? The cost-benefit analysis would be so far in the negative. Thank god for common sense. #building #construction #housing #affordability #policy. https://lnkd.in/gsFi6cxJ

HOW TO NAVIGATE TENANT IMPROVMENT COSTS: Bo Hargrove, SIOR was recently featured in SIORGlobal: Society of Industrial and Office Realtors Fall 2023 Report Magazine! This is a topic that impacts Tenants of all kinds in every vertical of CRE! Check it out below:   #rcr #richcommercialrealty #cre #commercialrealestate #SIOR #office #industrial #sioribg #construction #commercialconstruction #constructioncosts

The shift to remote work has left office buildings vacant, but innovative developers are capitalizing on this by transforming these spaces into residential units. Check out the article below that discusses how developers are coming up with creative solutions to address both the surplus of empty offices and lack of new housing construction. The future of real estate may just lie in these office-to-residential conversions Read Full Article [ Link in Comments ] #newyork #construction #building