Empty office buildings across the U.S. are being repurposed as housing. Approximately 90,300 units are planned for conversion from offices to apartments in 2026, according to the latest research from RentCafe. This demonstrates a 28% increase from the 70,600 slated for conversion a year ago.
Part of the reason for so many vacancies is the trend toward remote work that happened during the COVID-19 pandemic.
"COVID-19 is to the office market what e-commerce was to retail. As a result, there is simply too much office space in the market right now," Peter Kolaczynski, director of Yardi Research, explained in RentCafe's reporting.
This shift toward creating more residential buildings is particularly noticeable in metro areas like New York City, which added 143,000 residents in 2024 alone. RentCafe also reports that financial pressure and government-backed incentives are accelerating the rate of office-to-apartment conversions. With a third of U.S. office loans set to mature by the end of next year, the pressure is on owners to act on underperforming properties.
"A massive amount of office building loans — over $213 billion — are coming due by the end of 2026," Doug Ressler, senior analyst and manager of business intelligence, Yardi Matrix, said in the report. "When loans mature, borrowers need to either pay them off or refinance them. The problem is that many of these office buildings have lost significant value largely due to remote work trends reducing demand."
Despite the demand for these conversions, many are likely to take several years to complete, with the process often slowed by structural constraints, rising costs and regulatory requirements.
In the slideshow above, we'll look at the metro U.S. areas with the most office-to-apartment conversions in the pipeline, according to RentCafe.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.