Could Office-to-Housing Conversions Revitalize Downtown Boston?

Boston's ambitious office-to-residential conversion program has begun to turn vacant downtown office space into housing. The building at 281 Franklin St. is the first in the city's efforts to reimagine former commercial structures into living spaces.

According to a Boston.com report, the program has approved 29 buildings for conversion and plans for 1,730 residential units. Six projects are currently under construction.

The city is backing the effort by offering developers a 29-year, 75% residential tax abatement, as-of-right downtown zoning, streamlined Article 80 permitting, and zoning changes that allow residential use across all downtown districts to reduce costs and speed construction.

Experts caution that while the program won't solve office vacancies alone — which persist at about 20% — it could concentrate demand into fewer buildings and strengthen office and housing markets.

The national trend of these office-to-apartment conversions is surging, with more than 90,000 units in the pipeline. While New York and Washington, D.C. lead in planned conversions, Boston is advancing its efforts thanks to various redevelopment reforms and incentives.

According to Doug Ressler, senior research officer at Yardi Matrix, cost is a substantial driver for the increase in conversions. 

Converting buildings into housing isn't simple, noted Adam Burns, owner of Burns Realty & Investments. He was the developer behind the 281 Franklin St. project and is heading up the 63 Summer St. conversion, noted Boston.com. Challenges include ensuring natural light in deep floor plates, coordinating elevator and stair layouts, and upgrading older buildings to residential code, with feasibility varying by building.

While downtown Boston is seeing increased demand for residential living, the office-to-residential conversion comes with some catches. At 281 Franklin St., for example, studio apartments are renting for approximately $3,150 a month, which in and of itself is not enough to drive down costs. Adding residential units to what Darin Thompson, founder and CEO of Stuart St. James, called a “near-zero residential inventory,” however, should put “downward pressure over time,” according to Boston.com.