Adaptive Reuse Targets Apartment Buildings

There’s a certain appeal that comes with apartment buildings that were once something else,  such as a hotel or factory. Conversions of all types of commercial properties into multifamily assets have been taking place for at least 70 years but, in the past decade, office buildings have become the darling of adaptive reuse focused on creating homes, according to a new report from RENTCafe Blog.

In a startling jump, the 2010s saw 55 times more old buildings converted to apartment communities compared to the 1950s, according to Yardi Matrix data shared in the report, written by Alexandra Ciuntu.

A large swath of the conversions, 65%, have created affordable housing. Built in 1917 in Rochester, NY as the Eastman Dental Dispensary, the restored Eastman Gardens now provides affordable senior living apartments and is host to replicated murals and woodwork. Many former hotels also have become affordable apartment complexes.

In total, 778 old buildings have become apartments since 2010, while 1,876 such buildings have made the shift since the 1950s. Some geographic markets are seeing more conversion to apartments than another, while developers often have chosen creative properties to become multi-dwelling assets.

Chicago is home to the most repurposed apartment buildings, with 91 such edifices, followed by Philadelphia and, in third and fourth place, Los Angeles and New York City, respectively. Philly boasts an astounding 85 historic buildings that have become apartments, including the Sugar Refinery Apartments building, which now houses 66 units and

In terms of the number of apartments created by conversions, New York leads the pack, with nearly 18,500 projects, followed by Chicago, with 14,167; Philadelphia, 11.266; Los Angeles, 10,569; and St. Louis, MO, with over 7,000 units.

Throughout the last seven decades, factory conversions have created 442 apartment buildings around the country, as many such properties provide open space floor plans that lend themselves well to apartments. Hotels were the second most popular property type for conversions. The shift from rooms to apartments and reception areas into concierge desks is reportedly relatively simple to make, which has allowed for the creation of 434 apartment buildings.

“There’s just something about old building designs that never goes out of style,” Ciuntu said. “This decade, perhaps the shift to remote work will be the trigger for further office-to-apartment conversions. Or, maybe other building types, such as retail space, will give way to rental housing.”