Downtown Boston’s Class B market will see 2.5% reduction in vacancy following office to residential conversions.

In response to an underperforming office market and an increase in local government housing incentives, a plethora of Class B office owners have proposed converting their properties from office space to residential use.
Existing Class B office inventory would deplete by 815,000 square feet (due to proposed conversions being fully vacant), dropping from 26.7 msf to 25.9 msf. While this reduction in inventory is relatively small, it will have a significant impact on vacancy rates.
Currently, there are 14 class B properties slated for conversion which would add over 500 residential units to Downtown Boston. As mentioned previously, this initiative will significantly impact the area, as it would remove 815,000 square feet of vacant office space and reduce the Class B vacancy rate from 19.3% to 16.8%. As more property owners propose to convert their vacant office space to residential, the Class B vacancy rate is expected to continue its decline, contributing to healthier market conditions in Downtown Boston.

December 16, 2024

US-MA-BOS Boston

Office to Residential Conversions: The Impact on Downtown Boston’s Class B Market