Adaptive reuse is not new. Warehouses and strip malls have been converted to housing for decades, providing new streams of revenue to struggling owners and refitting to the changing needs of communities.
With many employees still deciding to work remotely now that the pandemic lockdowns are a thing of the past, and the corporations enjoying the savings of cutting down the office space, NYC is faced with the need for a similar undertaking – converting offices to apartments.
The City newspaper reported that, based on data from one of the leading global real estate services companies, JLL, New York has about 76 million square feet of vacant office space. This is a hard hit for the already rocky commercial real estate market, but other industries are also feeling the impact.
A compilation of small businesses serving previously crowded business districts, from shoe shiners to dry cleaners, hair and nail salons, innumerable lunch spots and coffee shops, have shuttered or struggle to stay afloat. Citing data from Stanford University, Bloomberg reported that workers coming into Manhattan are still spending $12.4 billion less per year than before the pandemic.
A report by a national pro-housing group, Up For Growth, found that even pre-pandemic, the NYC metropolitan area was 342,000 housing units short. Given the construction halt during and since the pandemic, it is unlikely that this number has improved.
It would seem that vacant office buildings and the housing shortage are two problems that are each other’s perfect solutions. Repurposing an existing building is cheaper than new construction, it would restore revenue to owners of office buildings that now sit half-empty, provide much needed housing and help retain the already scarce open spaces. Win-win-win-win.
But, of course, not so fast. Converting an office building for residential use is still a costly endeavor, not to mention having to contend with NYC’s exhaustive land use and construction bureaucracy, which has not been known as agile.
Yes, revising zoning laws has always been difficult. Nonetheless, the building and zoning codes evolved over the years to maintain a relative balance between business and residential needs in a crowded city; between the need for parks and other open spaces, offices and housing. City government and agencies work continuously – albeit with some shouting, to help ensure that everyone’s interests are served.
GAC often takes part in this process on behalf of a variety of clients, from construction companies and real estate developers, to engineering firms, colleges, hospitals, museums and community groups. We have negotiated tax incentives, including 421A benefits, zoning restrictions, landmark statuses, new construction projects and renovations of existing buildings. Adaptive reuse is no different, though perhaps the need is more urgent.
New Yorkers deserve better than boarded up grafitti-marked storefronts and office buildings sitting vacant while housing supply remains scarce and prices skyrocket. We can do better!
