BOSTON (WHDH) - Buildings are begging for business in downtown Boston.
‘Office space for rent’ signs are displayed on almost every street. The signs revealing the daunting reality that one in three buildings in the city are vacant.
Longtime residents say the streets aren’t much better.
“There use to be a lot of people. It use to look like New York, like you’d be walking and you’d be like ‘Oh, my god,’” Luis Ayala remembered.
Both are lingering effects of an increase in work-from-home policies and rent prices.
“It’s not affordable, nobody can live here,” Boston resident Jose Menjvar said.
A dwindling supply of units in downtown leaves high demand and prices for the apartments remaining. It was a problem city officials spotted even before the pandemic exacerbated it.
To combat the uptick in office vacancies and decrease in available apartments, the Boston Planning and Development Agency (BPDA) launched the Downtown Residential Conversion Incentive Pilot Program in 2023. The program offers financial incentives to developers and owners if they convert their older commercial offices to apartments.
“It’s a win-win for both the city and for the property owners,” said Prataap Patrose, the senior adviser of BPDA who has been working on the program for years.
Adam Burns is one of the property owners who saw the program as an opportunity.
“This is a program that can actually help us right now and to actually get housing back into Boston,” Burns said.
Burns owns Burns Realty and Investments. He regularly shows clients around office buildings.
“We’re walking through these buildings and we’re going, ‘Ooo there’s a lot of vacancy here,’” Burns said.
Last spring he decided to purchase an office building on Franklin Street from a property owner who was struggling to rent the office spaces. This March the building became the first approved by the city to be converted into apartments.
“I think our use for office space has fundamentally changed long term and we’re not going to see a shift back in the other direction; I think this shift is here to stay and downtown conversion programs such as this can elevate that glut of inventory that is on the market and take some of that office to have the demand meet the supply a little bit more readily,” Burns said.
The current commercial leases at his building are expiring soon and by this time next year in their place will be 15 apartments.
“There is a whole lot of infrastructure that does go into it of course.. there’s new plumbing, electrical, HVAC … all that does need to be done, that is a lot of infrastructure to build out, but we have a really great building to work off of here,” Burns said.
He said the conversion is costly but the tax incentives offered by the city are lessening the financial burden. He said without the program, the conversion wouldn’t be possible.
“We were looking at lot of buildings and we noticed the opportunity was there but the overall cost is just too high to do the conversion without having some additional revenue associated with it,” he said.
The city aims to create 300 new units through the pilot program; 60 will be affordable apartments.
Burns said the requirement for the projects to include affordable rates is vital.
“It’s everything, it really is..housing plays such a big role in people’s ability to live survive and thrive. We want people to be able to stay in Boston,” Burns said.
While 300 new units doesn’t seem like many, city officials believe it is just the start.
“The need for housing is dire across Massachusetts as it is across the country. No one program is going to fix it,” Patrose said. “We believe this program will be the catalyst for more conversions.”
Patrose believes creating more mix-use areas of the city will create a more vibrant and resilient Boston.
“This is the opportunity for Boston to have a very different kind of downtown; a downtown that until recently has been predominately commercial, the result of which is you have a downtown that is not very vital after 5 p.m. or weekends,” he said.
Patrose said while other cities have begun to start similar programs, Boston’s approach is innovative.
“Almost every week we are getting new inquiries from press from around the country and cities who are looking to do this in Massachusetts and across the country,” he said.
The city has received applications for five other sites. If all are approved, 173,000 square feet of space will be transformed into 216 units. The city is accepting applications until June.
“The city need this and we need owners who are willing to go through this program,” Burns said.
(Copyright (c) 2024 Sunbeam Television. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)