Washington D.C. Office to Residential - A Case Study

Is Washington, D.C. a template for effective office to residential conversion? - An Ivory Innovations Case Study

Hannah Gable

As of February, the broader Washington D.C. area had the largest pipeline of planned office-to-apartment conversions – this represents an 88% increase from the DMV’s 2023 pipeline. What about the D.C. metro area is making it a leader in adaptive reuse? In short: incentives, zoning, and public sector support. 

D.C. Greenlights Office-to-Apartment Incentives Program

In March, Mayor Muriel Bowser announced her “Housing in Downtown” initiative, which includes a 20-year tax abatement for office-to-residential conversions. The program will make at least $41M available through 2028. Aside from this, D.C. has additional incentive programs that have been in place since 2021. In 2021, the District of Columbia Department of Consumer and Regulatory Affairs (DCRA) put forward a proposal (that was implemented shortly after) for how the city could better support adaptive reuse projects, including accelerated plan review, relaxed zoning regulations, and building code modifications.

Thriving neighborhoods built on a strong residential foundation

The plan review, zoning, tax incentives, and code modifications mentioned above all align with Washington D.C.’s Downtown Action Plan proposed by district leadership, in collaboration with the Golden Triangle and DowntownDC Business Improvement Districts, in February. This is a 5-year economic development plan to make DC “a place for successful businesses, opportunity-rich neighborhoods, and thriving people”. The plan has five “foundational elements” that serve as the key pillars for how to make this strategy a reality – number three is “building a residential base”. Within this, the plan outlines a variety of “now” initiatives that will support conversions – flexibility in building codes, tax classifications for multifamily construction, and geographic bonuses within the tax abatement program.     

The district’s focus, alignment, and intentionality with encouraging adaptive reuse, especially as illustrated by their new Downtown Action Plan, serves as a strong signal to real estate developers that Washington D.C. is “open for business” when it comes to office-to-residential conversions, and the pipeline of projects demonstrate that.