Downtown Atlanta offices can be used for housing, study says
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Converting vacant offices into housing could generate 1,500 affordable homes in Downtown Atlanta, research shows.
- But it would require a $48 million public subsidy.
Why it matters: 28% of offices in Downtown are vacant, largely due to the rise in remote work. Converting some of those properties could bring more people into the neighborhood, add more transit-adjacent housing and breathe new life into a struggling neighborhood.
What they did: Central Atlanta Progress and the Atlanta Downtown Improvement District released a feasibility study on Monday to see if Downtown office buildings could be converted to residential.
- The study's authors analyzed the size, floor plan and age of 105 non-owner-occupied buildings with at least three stories to gauge their potential.
- In addition, they researched rent, vacancy rates, and potential subsidy needs to see if conversions are economically practical. They also studied Chicago, Boston, and other cities' use of grants and tax abatements to offset construction costs.
What they found: The analysis shows buildings are only rational to convert when their office vacancy exceeds 70%. Eleven buildings fit this criteria, or are projected to, within 5 years.
- The best conversion opportunities are between Peachtree Center and the State Farm Arena due to its weakening office market and growing residential market.
- Conversion costs — up to $250 per square foot — could be prohibitive. Public incentives could make a difference.
Caveat: The study doesn't account for owner willingness to sell or convert their buildings.
What they're saying: The study shows there's "no silver bullet" for office conversions, Marilynn Davis of HR&A Advisors, the firm that conducted the study, told Axios.
- "There's a range of things that have to come together in a certain way, and there is potential Downtown for that to happen, but it's not just one size fits all," Davis said.
The bottom line: Alena Green, Central Atlanta Progress' economic development director, said Atlanta's underperforming buildings aren't going anywhere, so they need to pivot to something that won't drain property values.
Go deeper: View the full study