Strong Office Conversion Pipeline Will Boost Business-Centric Downtowns

Office conversions have had a banner year to date in 2024, with 73 of them already completed and another 30 scheduled for delivery by year-end—the most since CBRE began tracking conversion projects in 2016.

Much of this activity is being driven by historically high office vacancy rates and falling asset values, prompting public/private partnerships that are incentivizing conversions. The pipeline of office conversions is expected to grow as cities offer more incentives and sellers of troubled assets further discount prices, particularly for older buildings.

As of Q3 2024, 71 million sq. ft. or 1.7% of U.S. office inventory was planned for or already undergoing conversion. This is the same amount of conversion activity as in Q1 2024, despite the completion of 45 projects totaling 7 million sq. ft. since then—an indication that the conversion pipeline is replenishing as projects are finished.

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RSK: I suppose you are thinking that the most successful conversions would be where other services for living such as grocery stores, health services etc, are located. But those retail and other services have a way of finding where people live. So if you convert, chances are these services will find you and locate you.