4 ms·

NYC's office-to-residential conversions could create 17,000 new homes

39 points by geox 1y ago

almosthere 1y ago
Residential interiors use far heavier products, don't have a central AC system (so each unit will have additional AC systems on the roof), and can have "upgraded over time" finishes (marble floors and countertops). How will they avoid a similar thing as the surfside condo collapse. Another thing to consider is that the plumbing is very different- way more bathrooms, and those bathrooms may not be near the core of the building - this can cause instability in weight distribution especially when everyone is doing their mornin routine.
- nashashmi 1y ago
  Commercial buildings are designed for higher loads than residential buildings: I think it is 150 psf vs 80 psf.
- hinkley 1y ago
  You could certainly force the bathroom placement with the wet walls. Code is code, and space folding does not exist. So if you only allow for 18” of drop on the pluming then all the drains have to be within fifteen foot radius of the sewer line. And the floor beams will limit that further. That said, the responsible thing is not to convert the whole building but make a sandwich of retail ground floor, residential above, then commercial, then maybe real estate top floors. Weight carried low is fewer failure points for the building.
- vladvasiliu 1y ago
  I agree with your other points, but does actually each unit need a dedicated AC? I live in a building with district heating, we all get the same hot water. If I don't want to live in an oven during the winter, I'll turn down the heaters' thermostats, which lets less hot water in. Couldn't we have a similar thing for cold air in the summer? Send the same temperature to everybody, and allow people to choose how much of that air they allow in their units. Shouldn't this also be more efficient than a dedicated AC unit per home?
  - esseph 1y ago
    If you're aiming for efficiency and not individualized comfort you will have less interested parties. Some people run hot, some cold.
    - izacus 1y ago
      Is there any risk of no interest in NYC?
      - esseph 1y ago
        I'm sure I could sell a used sausage to someone in NYC.
  - vel0city 1y ago
    Lots of cities have building codes for multifamily residential that requires independent ventilation for each unit to reduce cross contamination, or requires zones and duct work that prevents such mixture of air. This generally isn't true in commercial office buildings, which are more along the lines of what you're talking about. But often tenants themselves don't even directly control their temperature at will; it is managed by property management.
  - TuringNYC 1y ago
    I lived in NYC. Problem with non-individual pipes is that you get Marijuana smoke and cigarette smoke from neighboring apartments to yours. Also if there are multiple units, there is always plausible deniability on who the culprit is.
    - josefritzishere 1y ago
      This is real and very stinky.
    - vladvasiliu 1y ago
      Wouldn’t the air pressure keep whatever smoke is in an apartment outside the pipe ? So that would prevent it from traveling from one to the other. I used to live in a high rise which had a common pipe for extraction, I never had any odor coming in, and I know my neighbors were smoking since I would get smoke if the windows were open.
- kccqzy 1y ago
  Each unit doesn't need AC systems on the roof. Window ACs and wall units suffice. They are also more efficient than central AC due to the lack of ducts. And if the office was old (prewar) it likely didn't have AC in the first place so it had ventilation shafts and courtyards, and you could get away with not having AC in certain spaces that are far from windows.
- abeppu 1y ago
  Why is the surfside condo collapse specifically relevant for office-to-residential conversions? That building was built for residential from the start. And that building also had basically ignored a major maintenance issue for multiple years.
- adanto6840 1y ago
  I’m sure that structural engineers will be heavily involved. While there are some things to consider or worry about, I don’t know that any of your concerns are actually valid things to be overly worried about. They’re certainly all solvable and I have no doubt that the PE(s) putting their stamps on it will have valid proven solutions that check out mathematically.
spaceribs 1y ago
I really want to see more dorm style apartments available in NYC, see: https://www.evergreen.edu/sites/default/files/styles/large/public/2023-05/a-floorplans-1%20copy.jpg.webp https://www.evergreen.edu/sites/default/files/styles/large/p... Even more tenement type layouts would be spectacular for increasing stock, but this is just half of the problem. It's all entirely dependent on reducing the level of greed landlords can get away with today.
- mycodendral 1y ago
  I would rather it just be expensive to live in NYC
  - epistasis 1y ago
    I can see the benefit to allowing more people to live in NYC, at cheaper prices, because it gives more people more options. Can you explain what benefit could come from making NYC more expensive? Who benefits from that, and how? I could see landowners wanting that, but that's such a tiny fraction of the NYC populace that I doubt that's your motivation...
    - hemloc_io 1y ago
      Generally speaking it’s “quality of life”. NYC doesn’t have any physical gates, but living in manhattan in particular, has a high financial gate, keeping out people who can’t afford it. Generally people paying 5k+ rents aren’t committing violent crime, homeless sweeps actually happen here and it’s not really possible to sleep on the street. If you live in an exclusive neighborhood, it’s pretty clean and safe. there’s angst cheaper rent would change that EDIT: In a lot of ways NYC’s wealthy and the upper middle class that mostly lives in manhattan have mutual interests the biggest being public safety interesting interview if you’re interested in more https://podcasts.apple.com/us/podcast/odd-lots/id1056200096?i=1000716800532 https://podcasts.apple.com/us/podcast/odd-lots/id1056200096?...
    - NoMoreNicksLeft 1y ago
      >Can you explain what benefit could come from making NYC more expensive? People in cities have fewer children, and since children are the future tax base you might want that to occur so that you're not ground up into dogfood in your old age to pay down the national debt. I do wonder how people think office buildings will comply with fire code which demands multiple avenues of escape from bedrooms during such a catastrophe.
eachro 1y ago
What would it take to make NYC more like Tokyo where you have consumer/retail level things on the not-ground floor level.
- geetee 1y ago
  I've seen some of this around ktown. The elevators are always tiny and dingy. Not a fan at all.
- antithesizer 1y ago
  Among other things, a culture of shoppers who know to look upstairs
- mbStavola 1y ago
  This already exists, especially in the outer boroughs. But of course I'd love to see more of it!
kccqzy 1y ago
Here's a really nice if slightly out-of-date New Yorker article about such conversions: https://www.newyorker.com/magazine/2024/05/06/can-turning-office-towers-into-apartments-save-downtowns https://www.newyorker.com/magazine/2024/05/06/can-turning-of... I prefer to read this in conjunction with just seeing a table of data. The author talked to the architects involved and added more color to it.
vondur 1y ago
It seems like it'd be pretty expensive to convert office buildings to apartments. I'd imagine there are a ton of building regulations that office buildings don't have to adhere to compared to an apartment.
- makestuff 1y ago
  I have toured a few converted buildings in NYC. You end up with weird apartment layouts for reasons you mentioned. For example, a lot of the layouts were really long and narrow to satisfy the window requirement since office buildings are generally just giant square floors where you can have desks without direct window access. I think the other issues are running plumbing and electrical to each unit where an office building just needs a central room with plumbing for a common bathroom area. Overall the economics seem to work in NYC since rents are so expensive, but I would imagine converting an office tower in a MCOL or LCOL city would be harder to make profitable.
- rufus_foreman 1y ago
  It's very expensive. But $5 billion in tax incentives helps: "the report warns that the city’s new 467-m tax break may be overly generous, potentially costing $5.1 billion in lost property tax revenue over 37 years".
  - Neywiny 1y ago
    That's just too speculative. My viewpoint has always been no tax breaks on stadiums, headquarters, etc, but you just can't know what'll happen. At least if you give the break you have somewhat of idea that they'll be more incentivized
- burningChrome 1y ago
  Anecdotal evidence: In the early 2000's when the dot com bubble burst, a well known commercial real estate developer here had the same idea because many of the large corporate buildings went empty or went into foreclosure or had various other financial issues. He bought one and I was told by several contractors who worked for him that he would brag about the sweetheart deal the city gave him and how little he would have to pay to convert the buildings into town homes. Because of the dot com bust, he also got a bottom floor deal on the price of the building. It took several years to convert, but that's kind of when the wheels started to fall off. 9 people (at last count) were charged with mortgage fraud in a kick back scheme. They tried to buy up a bunch of the condos and then planned to resell them at higher prices. They were using ghost buyers to get financing. Ironically the developer was never charged, but several real estate agents and their brokers plead guilty to fraud. The developer had also bought several other buildings with the intention of doing the same. None of them ever came to fruition and by the time the 2008 housing crash rolled around, he had lost two of the other three buildings to foreclosure and I'm not sure what happened to the other one. The developer just got lucky. Right time to buy low and sell high, but then once he was straddled with market cost of the building and no sweetheart deals on labor and tax breaks from the city? It quickly became apparent unless you have very, very deep pockets, a conversion like this is very expensive and takes a long time for you to see any return on your investment. On the bright side if you google the name "Cloud 9 Sky Flats Hopkins MN" you'll see the building they used. There are several local real estate companies who still sell the flats and they are amazing with incredible views of the city. Here's some articles about the Cloud 9 Flats fraud: 8th Guilty Plea Entered in $14M Cloud 9 Mortgage Fraud https://tcbmag.com/8th-guilty-plea-entered-in-14m-cloud-9-mortgage-fraud/ https://tcbmag.com/8th-guilty-plea-entered-in-14m-cloud-9-mo... Developer Jerry Trooien unlikely to be charged in condo fraud case, attorneys say https://www.twincities.com/2013/02/12/developer-jerry-trooien-unlikely-to-be-charged-in-condo-fraud-case-attorneys-say/ https://www.twincities.com/2013/02/12/developer-jerry-trooie...
ardit33 1y ago
Buying in NYC is just wild. A condo can have a 400$/mo tax, while the next door one is 1300/mo, and the other one down the street can be only 35$/mo for the first 20 years. There is also a mortgage tax of 2.05% for a loan, which is batshit crazy as it favors rich 'cash only' people, instead of middle class / poor folks. Also, everything over 1m has a 'mansion' tax, where a 1m gets you one bedroom, without even a washer and dryer, and also there is a 'new building tax' which is another 1% or 2%. For a 'not new' smallish 2bdr, 800sfq, in Greenpoint, the cost of purchase was 1.3m-1.35m and just the closing costs (taxes and all) was 55K! Just to buy a place (not talking about downpayment and all). With a current rates, you'd end up paying 9k-10k for a basic (10 years old) 2 bedroom, which is insane at any levels. Anways, end of my rant. The city needs to both build more, and lower taxes for residents, and raise them for anyone that is not a NY resident. Period. But the builders have resisted this, and Cuomo the coorporate stooge gorvenor we had vetoed/ended a initiative to have good taxation that favors residents. Building more and giving tax breaks to anyone (even foreginers/non state residents), is just a hand out to developers, and 1/3rd to those apartment will be used a 'storage' for outside money. Locals loose on this.
am3101 1y ago
Just to put this in perspective, the Mamdani housing plan is 200k homes over ten years which would be far below the historic pace of new construction in nyc. Conversions are great but a drop in the bucket.

39 points by geox 1y ago

Residential interiors use far heavier products, don't have a central AC system (so each unit will have additional AC systems on the roof), and can have "upgraded over time" finishes (marble floors and countertops). How will they avoid a similar thing as the surfside condo collapse. Another thing to consider is that the plumbing is very different- way more bathrooms, and those bathrooms may not be near the core of the building - this can cause instability in weight distribution especially when everyone is doing their mornin routine.

nashashmi 1y ago
Commercial buildings are designed for higher loads than residential buildings: I think it is 150 psf vs 80 psf.
hinkley 1y ago
You could certainly force the bathroom placement with the wet walls. Code is code, and space folding does not exist. So if you only allow for 18” of drop on the pluming then all the drains have to be within fifteen foot radius of the sewer line. And the floor beams will limit that further. That said, the responsible thing is not to convert the whole building but make a sandwich of retail ground floor, residential above, then commercial, then maybe real estate top floors. Weight carried low is fewer failure points for the building.
vladvasiliu 1y ago
I agree with your other points, but does actually each unit need a dedicated AC? I live in a building with district heating, we all get the same hot water. If I don't want to live in an oven during the winter, I'll turn down the heaters' thermostats, which lets less hot water in. Couldn't we have a similar thing for cold air in the summer? Send the same temperature to everybody, and allow people to choose how much of that air they allow in their units. Shouldn't this also be more efficient than a dedicated AC unit per home?
- esseph 1y ago
  If you're aiming for efficiency and not individualized comfort you will have less interested parties. Some people run hot, some cold.
  - izacus 1y ago
    Is there any risk of no interest in NYC?
    - esseph 1y ago
      I'm sure I could sell a used sausage to someone in NYC.
- vel0city 1y ago
  Lots of cities have building codes for multifamily residential that requires independent ventilation for each unit to reduce cross contamination, or requires zones and duct work that prevents such mixture of air. This generally isn't true in commercial office buildings, which are more along the lines of what you're talking about. But often tenants themselves don't even directly control their temperature at will; it is managed by property management.
- TuringNYC 1y ago
  I lived in NYC. Problem with non-individual pipes is that you get Marijuana smoke and cigarette smoke from neighboring apartments to yours. Also if there are multiple units, there is always plausible deniability on who the culprit is.
  - josefritzishere 1y ago
    This is real and very stinky.
  - vladvasiliu 1y ago
    Wouldn’t the air pressure keep whatever smoke is in an apartment outside the pipe ? So that would prevent it from traveling from one to the other. I used to live in a high rise which had a common pipe for extraction, I never had any odor coming in, and I know my neighbors were smoking since I would get smoke if the windows were open.
kccqzy 1y ago
Each unit doesn't need AC systems on the roof. Window ACs and wall units suffice. They are also more efficient than central AC due to the lack of ducts. And if the office was old (prewar) it likely didn't have AC in the first place so it had ventilation shafts and courtyards, and you could get away with not having AC in certain spaces that are far from windows.
abeppu 1y ago
Why is the surfside condo collapse specifically relevant for office-to-residential conversions? That building was built for residential from the start. And that building also had basically ignored a major maintenance issue for multiple years.
adanto6840 1y ago
I’m sure that structural engineers will be heavily involved. While there are some things to consider or worry about, I don’t know that any of your concerns are actually valid things to be overly worried about. They’re certainly all solvable and I have no doubt that the PE(s) putting their stamps on it will have valid proven solutions that check out mathematically.

spaceribs 1y ago

I really want to see more dorm style apartments available in NYC, see: https://www.evergreen.edu/sites/default/files/styles/large/public/2023-05/a-floorplans-1%20copy.jpg.webp https://www.evergreen.edu/sites/default/files/styles/large/p... Even more tenement type layouts would be spectacular for increasing stock, but this is just half of the problem. It's all entirely dependent on reducing the level of greed landlords can get away with today.

mycodendral 1y ago
I would rather it just be expensive to live in NYC
- epistasis 1y ago
  I can see the benefit to allowing more people to live in NYC, at cheaper prices, because it gives more people more options. Can you explain what benefit could come from making NYC more expensive? Who benefits from that, and how? I could see landowners wanting that, but that's such a tiny fraction of the NYC populace that I doubt that's your motivation...
  - hemloc_io 1y ago
    Generally speaking it’s “quality of life”. NYC doesn’t have any physical gates, but living in manhattan in particular, has a high financial gate, keeping out people who can’t afford it. Generally people paying 5k+ rents aren’t committing violent crime, homeless sweeps actually happen here and it’s not really possible to sleep on the street. If you live in an exclusive neighborhood, it’s pretty clean and safe. there’s angst cheaper rent would change that EDIT: In a lot of ways NYC’s wealthy and the upper middle class that mostly lives in manhattan have mutual interests the biggest being public safety interesting interview if you’re interested in more https://podcasts.apple.com/us/podcast/odd-lots/id1056200096?i=1000716800532 https://podcasts.apple.com/us/podcast/odd-lots/id1056200096?...
  - NoMoreNicksLeft 1y ago
    >Can you explain what benefit could come from making NYC more expensive? People in cities have fewer children, and since children are the future tax base you might want that to occur so that you're not ground up into dogfood in your old age to pay down the national debt. I do wonder how people think office buildings will comply with fire code which demands multiple avenues of escape from bedrooms during such a catastrophe.

eachro 1y ago

What would it take to make NYC more like Tokyo where you have consumer/retail level things on the not-ground floor level.

geetee 1y ago
I've seen some of this around ktown. The elevators are always tiny and dingy. Not a fan at all.
antithesizer 1y ago
Among other things, a culture of shoppers who know to look upstairs
mbStavola 1y ago
This already exists, especially in the outer boroughs. But of course I'd love to see more of it!

kccqzy 1y ago

Here's a really nice if slightly out-of-date New Yorker article about such conversions: https://www.newyorker.com/magazine/2024/05/06/can-turning-office-towers-into-apartments-save-downtowns https://www.newyorker.com/magazine/2024/05/06/can-turning-of... I prefer to read this in conjunction with just seeing a table of data. The author talked to the architects involved and added more color to it.

vondur 1y ago

It seems like it'd be pretty expensive to convert office buildings to apartments. I'd imagine there are a ton of building regulations that office buildings don't have to adhere to compared to an apartment.

makestuff 1y ago
I have toured a few converted buildings in NYC. You end up with weird apartment layouts for reasons you mentioned. For example, a lot of the layouts were really long and narrow to satisfy the window requirement since office buildings are generally just giant square floors where you can have desks without direct window access. I think the other issues are running plumbing and electrical to each unit where an office building just needs a central room with plumbing for a common bathroom area. Overall the economics seem to work in NYC since rents are so expensive, but I would imagine converting an office tower in a MCOL or LCOL city would be harder to make profitable.
rufus_foreman 1y ago
It's very expensive. But $5 billion in tax incentives helps: "the report warns that the city’s new 467-m tax break may be overly generous, potentially costing $5.1 billion in lost property tax revenue over 37 years".
- Neywiny 1y ago
  That's just too speculative. My viewpoint has always been no tax breaks on stadiums, headquarters, etc, but you just can't know what'll happen. At least if you give the break you have somewhat of idea that they'll be more incentivized
burningChrome 1y ago
Anecdotal evidence: In the early 2000's when the dot com bubble burst, a well known commercial real estate developer here had the same idea because many of the large corporate buildings went empty or went into foreclosure or had various other financial issues. He bought one and I was told by several contractors who worked for him that he would brag about the sweetheart deal the city gave him and how little he would have to pay to convert the buildings into town homes. Because of the dot com bust, he also got a bottom floor deal on the price of the building. It took several years to convert, but that's kind of when the wheels started to fall off. 9 people (at last count) were charged with mortgage fraud in a kick back scheme. They tried to buy up a bunch of the condos and then planned to resell them at higher prices. They were using ghost buyers to get financing. Ironically the developer was never charged, but several real estate agents and their brokers plead guilty to fraud. The developer had also bought several other buildings with the intention of doing the same. None of them ever came to fruition and by the time the 2008 housing crash rolled around, he had lost two of the other three buildings to foreclosure and I'm not sure what happened to the other one. The developer just got lucky. Right time to buy low and sell high, but then once he was straddled with market cost of the building and no sweetheart deals on labor and tax breaks from the city? It quickly became apparent unless you have very, very deep pockets, a conversion like this is very expensive and takes a long time for you to see any return on your investment. On the bright side if you google the name "Cloud 9 Sky Flats Hopkins MN" you'll see the building they used. There are several local real estate companies who still sell the flats and they are amazing with incredible views of the city. Here's some articles about the Cloud 9 Flats fraud: 8th Guilty Plea Entered in $14M Cloud 9 Mortgage Fraud https://tcbmag.com/8th-guilty-plea-entered-in-14m-cloud-9-mortgage-fraud/ https://tcbmag.com/8th-guilty-plea-entered-in-14m-cloud-9-mo... Developer Jerry Trooien unlikely to be charged in condo fraud case, attorneys say https://www.twincities.com/2013/02/12/developer-jerry-trooien-unlikely-to-be-charged-in-condo-fraud-case-attorneys-say/ https://www.twincities.com/2013/02/12/developer-jerry-trooie...

ardit33 1y ago

Buying in NYC is just wild. A condo can have a 400$/mo tax, while the next door one is 1300/mo, and the other one down the street can be only 35$/mo for the first 20 years. There is also a mortgage tax of 2.05% for a loan, which is batshit crazy as it favors rich 'cash only' people, instead of middle class / poor folks. Also, everything over 1m has a 'mansion' tax, where a 1m gets you one bedroom, without even a washer and dryer, and also there is a 'new building tax' which is another 1% or 2%. For a 'not new' smallish 2bdr, 800sfq, in Greenpoint, the cost of purchase was 1.3m-1.35m and just the closing costs (taxes and all) was 55K! Just to buy a place (not talking about downpayment and all). With a current rates, you'd end up paying 9k-10k for a basic (10 years old) 2 bedroom, which is insane at any levels. Anways, end of my rant. The city needs to both build more, and lower taxes for residents, and raise them for anyone that is not a NY resident. Period. But the builders have resisted this, and Cuomo the coorporate stooge gorvenor we had vetoed/ended a initiative to have good taxation that favors residents. Building more and giving tax breaks to anyone (even foreginers/non state residents), is just a hand out to developers, and 1/3rd to those apartment will be used a 'storage' for outside money. Locals loose on this.

am3101 1y ago

Just to put this in perspective, the Mamdani housing plan is 200k homes over ten years which would be far below the historic pace of new construction in nyc. Conversions are great but a drop in the bucket.