Affordable housing is possible, if we stop ignoring the obvious | Opinion

American cities are short on housing yet full of unused space. Since COVID-19-era shutdowns, large chunks of commercial real estate – particularly in urban epicenters where people once commuted to work – have sat vacant for more than half a decade.

Prior to the pandemic, office vacancies hit a record low of 11.4% in 2019. In America’s top metropolitan areas, the vacancy rate reached a historic high of 20.1% in 2024. It slightly improved in 2025, but remained at 18.4% by the year’s end.

With nearly a quarter of the workforce going remote, and no amount of return-to-office mandates likely to change this trend, it’s time for cities to repurpose these empty buildings to meet the demands of the moment.

Home sweet ... office space?

While offices closed down, the demand for housing in America’s greatest cities never subsided. With a relatively constrained supply of apartments, the cost of rent skyrocketed, especially in popular cities like New York. Rents there vastly outpaced inflation, rising 6.6% in the past year.

It seems as if the cost of rent began to dominate political discourse around affordability, with voters’ attention turning to how housing policy can meet the needs of the people. Pushed by public sentiment, now elected officials are looking for a comprehensive agenda to bring the cost of living down.

Turning these once-bleak cubicles into apartment complexes for those who still live in cities would require state and local politicians approaching zoning policies, building codes and taxation with fresh eyes.

Local governments typically zone land under various categories, including commercial and residential. Properties categorized as commercial are sometimes unable to be converted into apartment complexes because of this.

City councils and municipal governments reforming zoning ordinances would be the first step to allowing more real estate transformation deals to happen. This could come through expedited rezoning processes or creating more flexible zoning categories in the first place, allowing commercial space to revert to residential zoning with minimal government intervention.

Building codes often further complicate the redevelopment process. Denser housing like apartment and condo-style living is deemed commercial under some codes, imposing costly construction requirements on the projects. With more complex requirements for building safety, structural integrity, and accessibility, commercial development often becomes more expensive than residential design.

Higher costs to build slow down redevelopment, making the real estate market less able to promptly respond to consumer demand. Reviewing the existing building codes with considerations as to how they affect these types of projects, and other efforts to build more residential housing, could prove pivotal in accelerating timelines and unleashing new opportunities.

Change won't happen without government help

Looming over all these endeavors is the lack of financial incentives. Developers need accessible capital in order to remodel stuffy office spaces, with their poor overhead lighting and all, into beautiful new homes.

These projects can cost in the hundreds of millions of dollars, such as the project to transform an office tower in Chicago into 349 new apartments. Converting old offices into livable apartments requires new electrical wiring, plumbing, fire alarm systems, heating, ventilation, air conditioning and more. 

To fund for this remodeling construction, changes must be made to tax policy. Lawmakers on the state and federal level should look to tax deductions for such commercial-to-residential construction.

Democratic members of Congress have already introduced a version in the form of a tax credit, but other models and state-level options can be considered to maximize opportunity for suitable growth in available housing units.

Some cities are taking the lead

Some cities have already made decent strides toward converting unused commercial real estate into homes due to political leadership with a vision. In Philadelphia, 10 floors of the 27-story Ten Penn Center will be converted from office space into nearly 300 apartments. This comes by no surprise, as the city’s mayor has pushed such projects with a proposal for tax abatements to support them.

Similarly, a 75,000-square-foot Encino office building in Los Angeles has been acquired for residential conversion as the city’s leadership promotes the conversion of underutilized commercial spaces into residential units through regulatory reform.

These projects are a starting point for making the cities more residential and less vacant, but getting these developments to occur more often requires intentional policy changes aimed at incentivizing a market shift toward people’s real needs.

Converting commercial properties into residential space, so heavily demanded, is common sense. The land is sitting there, waiting to be used. It’s time to build – or remodel. 

Sam Raus is the David Boaz Resident Writing Fellow at Young Voices. Follow him on X: @SamRaus1