DALLAS — A record amount of office spaces are expected to be repurposed in 2024, with 55,000 office-to-apartment conversions expected across the country – a fourfold increase from four years ago, according to Yardi’s RentCafe report.
The Dallas area is among the top markets where empty office spaces are being converted into apartments.
More than 3,100 new Dallas-area apartments are expected to be created from former office buildings this year, according to the Yardi report, with another 3,833 units expected to be created in the future.
This makes the area among the top markets in the country where vacant office spaces are being converted into apartments, with 3,163 office-to-apartment conversions expected this year (a 58% jump from the prior year), behind only New York (with 5,215) and Washington D.C. (with 5,820).
Standing out as Dallas’ largest project is the redevelopment of the Renaissance Tower on Elm Street. Other projects in Dallas are the conversion of the Bryan Tower (425 units), the transformation of the former Oncor building (330 units) and the redevelopment of the former Star-Telegram headquarters (268 units).
"Over the last four years, we've seen extraordinary growth in the conversion of office buildings into living spaces. Back in 2021, a modest 12,100 apartments were being crafted out of old office spaces. By 2022, that number had nearly doubled to 23,100,” RentCafe’s Andrea Neculae wrote in the report. “The climb continued as 2023 saw an increase to 45,200, and now, as we step into 2024, the pipeline has reached an impressive 55,300. That's more than a fourfold increase since the trend began.”
The average age of office buildings being converted into rental units is 72 years old.
“Behind this shift lies a crucial factor: the $150 billion in office mortgages due by 2024,” according to the report.
“Currently, office conversions represent a staggering 38% of the 147,000 apartments in future adaptive reuse projects, outpacing any other building type. That's not just the largest slice of the redevelopment pie—it's a record high since 2020,” the report continued.
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