Jan 30, 2024 - News

Dallas is a leader in office-to-apartment conversions

Data: RentCafe; Table: Axios Visuals
Data: RentCafe; Table: Axios Visuals

The Dallas area is one of the top metros for converting vacant office space into new apartments, per a new RentCafe report.

Why it matters: Redeveloping underused office space is a key part of plans in many big cities to adapt to post-pandemic realities and create much-needed housing, Axios' Kate Marino reports.

Driving the news: More than 3,100 Dallas area apartments will be converted from office space this year, and more than 3,800 are planned in the future.

  • The Dallas region falls behind just New York City and Washington, D.C., in the number of planned office conversions.

Zoom out: More than 55,300 new units are expected from office-to-apartment flips nationally this year — up from 12,100 in 2021.

  • The flips now account for 38% of the 147,000 apartments planned in adaptive reuse projects. Hotel conversions account for about a quarter of the projects.

The intrigue: Planned office conversions in Dallas are up 58% this year compared with last year.

Yes, but: The average asking rent for converted units is nearly $2,700 per month, above the average downtown rent of $2,300 a month.

  • And some higher-end conversions, such as The National, have rents as high as $6,000, per CoStar.
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