This week, New York City’s Office Adaptive Reuse Task Force released a study calling on the city and New York State to loosen regulations preventing the conversion of older office stock into much-needed housing.

“The need for housing is desperate, and the opportunity offered by underused office space is clear,” said Mayor Eric Adams in a press release. “These concrete reforms would clear red tape and create the incentives to create the housing we need for New Yorkers at all income levels.”

The study estimates that as of November 2022, the city’s office workers were visiting their offices half as frequently as before the COVID-19 pandemic. According to the study, older office spaces that lack amenities have been particularly hard hit and are struggling to attract tenants. The Task Force’s recommendations build on Mayor Adams’ City of Yes and Get Stuff Built plans by seeking to drive investment into repurposing these spaces for residential use.

The Task Force’s recommendations fall into three categories:

1.      Expanding the range of buildings eligible for the most flexible conversion regulations. These recommendations involve amending city and state regulations to allow more flexible conversions of office buildings constructed before December 31, 1990, in all high-intensity commercial districts. The Task Force is also calling on the city to evaluate the potential for new residential development and residential conversions in areas of Midtown Manhattan currently zoned for manufacturing.

2.      Reforming existing conversion regulations. These recommendations involve amending city and state regulations to loosen burdensome requirements that prevent investment in residential conversions, including eliminating parking requirements and removing limitations on the amount of office space that can be converted to residential use.

3.      Providing financial incentives for affordability. The study recognizes that office conversions to 100% affordable housing are generally infeasible. Still, the Task Force calls for a government incentive, such as tax breaks, to encourage mixed-income residential conversions. The study also recognizes the need for a property tax abatement for retrofits incorporating child care centers, originally proposed in Mayor Adams’ Blueprint for Child Care & Early Childhood Education.

There is no timeline for implementing the Task Force’s recommendations, but the study calls on the state to enact statutory changes during the 2023 legislative session.

“Adaptive reuse of office space offers New York a significant opportunity to produce more housing,” said New York State Senator Brian Kavanagh, Chair of the State Senate’s Committee on Housing, Construction, and Community Development. State Senator Kavanagh added that he looks forward to reviewing legislation that will come as a result of the study and making “real progress on this critical priority this session.”

We will continue to keep a close eye on the implementation of the Task Force’s recommendations, and we welcome any requests for further information.