Consider Office-to-housing Conversions

Editorial

 

Gov. Maura Healey’s administration recently announced it is providing $15 million to help extend a Boston program designed to bring more vibrancy downtown by converting underused office buildings to housing.

The money will help Mayor Michelle Wu continue a program that offers property tax breaks for such office-to-residential conversions. Since the program was launched last fall, developers have filed nine proposals to convert office space across 13 buildings that collectively could bring another 412 housing units to Boston’s central business district. With the conversion program, Wu is offering developers as much as 75% off property tax bills for up to 29 years.

With this state money coming, the Wu administration has decided to keep the program going until the end of 2025, instead of ending it on June 30 as initially planned, with the hopes of spurring another 300 to 500 units.

The program is intriguing, and it is our hope that the Healey administration — and the Legislature — will make similar incentives available to other communities, including Springfield and other cities in Western Mass. Indeed, the state aid to Boston comes as the Legislature considers a housing bond bill that could further boost office-residential conversions. A version that recently passed the House would provide $150 million in technical assistance funds for cities and towns while creating tax credits equal to as much as 10% of the project costs to incentivize conversions.

Communities in this region haven’t been hit as hard as Boston when it comes to soaring vacancy rates in office buildings due to the huge pendulum swing toward remote work — and few, if any, signs that the pendulum might actually swing back any time soon. But communities like Springfield, Northampton, and even Greenfield have certainly felt the pinch — and for longer.

In Springfield, there are buildings, such as the property generally known as Harrison Place, once home to Bank of Western Massachusetts, and others along Main Street, that have been vacant or largely vacant since long before COVID. And with the shift toward remote work, there is little hope they can return to that use.

Meanwhile, some properties that were dedicated to office or a mix of office and retail, such as the Clocktower Building and the Colonial Block, are being redeveloped for mostly residential use — and those doing the developing could certainly use some additional pots of money to make these efforts reality.

That’s because conversion from office to residential isn’t easy, and it’s quite expensive.

In Boston, the incentive program was created as a way to bring more vibrancy in the wake of a sharp decline in the number of workers coming to the city on a daily basis; there have been studies to suggest that downtown foot traffic is roughly half of what it was before the pandemic. The theory, and it has a great deal of validity, is that people living in those buildings can provide at least as much, if not more, support to businesses in that area than people working in them.

The same is true for Springfield and other cities in this region.

That’s why we hope the incentives being offered to developers in Boston are made available across the Commonwealth. As we noted, conversions from office to residential are not easy or cheap, but they provide solid hope for bringing more vibrancy to downtown areas, while also helping to alleviate a Commonwealth-wide shortage of housing.