The Biden administration is pushing to turn empty office buildings into housing units, offering federal funds for support across states.
The federal initiative announced on Friday involves multiple departments to address the shortage of affordable housing and surplus of vacant office buildings due to the pandemic.
“This presents an area of opportunity to both increase housing supply while revitalizing main streets. It’s a win-win,” said Lael Brainard, director of the National Economic Council. “We’re utilizing resources from across the government.”
The new measures will promote affordable housing near transportation hubs, with guidance from Transportation Secretary Pete Buttigieg on accessing federal funding.
According to Buttigieg, “over $35 billion in lending capacity” will be made available to provide below-market rate loans to finance both new housing construction and office conversions near transportation hubs.
“These downtowns and central business districts .. are already designed and oriented around public transit,” Buttigieg said. “Our intention is to make the most of this opportunity to add more housing near transit in ways that not only reduce the cost of housing but also the cost of transportation.”
The Department of Transportation will provide guidance for transit agencies to transfer unused properties for affordable housing projects, potentially to local governments, nonprofits, or private developers with commitments to include affordable housing units.
Additionally, The GSA will collaborate with the Office of Management and Budget to identify surplus federal properties for potential transformation into affordable housing.
The White House is providing a guidebook with over 20 federal programs across six agencies to support the conversion of office buildings to housing. These programs offer loans, grants, and tax incentives for developers. The initiative addresses the challenges of half-empty business districts due to hybrid work models.
“The pandemic changed the patterns of how many Americans live and work,” Buttigieg said.
Businesses shifting to remote work have led to empty offices, leaving property owners and cities facing financial challenges due to decreased occupancy and reduced tax revenue.
Even as the pandemic recedes, businesses are downsizing their office space after long-term leases expire. Multiple city governments are supporting office-to-housing conversions by providing tax incentives to developers to address the financial challenges associated with these conversions.
According to Deputy HUD Secretary Adrianne Todman, the package of initiatives aims to boost office-to-housing conversion efforts throughout the United States significantly.
Discover more from Baller Alert
Subscribe to get the latest posts sent to your email.
