If working from home becomes permanent, will vacant offices solve housing crises?
 

This is something I have been thinking a lot about regarding the recent trends in corporate America. I am extremely worried for US cities, in particular (it doesn't seem like Europe/Asia has the same issue with remote work) with how they will cope with potentially much of corporate America working from home permanently. The company I work at for example, rid itself of its expensive Beverly Hills lease back in April and it doesn't appear we'll ever go back since our CEO likes that he's saving money.

More and more, it seems that the tech industry for example is going full throttle with this new "ideal", but what about the hundreds of thousands of small businesses and jobs that will be destroyed as a result? Think about one office skyscraper in SF or Manhattan, and how many nearby ecosystems depend on those commuters. All of the nearby tailors, dry cleaners, cafes, fast-casual eateries, etc. Pretty horrifying to think about.

That said, do you think if this indeed becomes our new way of life, that office spaces en masse would begin to be converted into living spaces/condos? That would potentially be an ideal solution for the major housing shortages in attractive cities, without the hassle of getting permits for new development, etc., particularly in NIMBY plagued environments...provided that people will want to still live in downtown or dense areas.

Great questions....

I think some companies will still want folks to come in for a portion of time to collaborate, etc. However, the footprint will probably be much smaller than before, so there's that. However, for those of us that go permanently remote, many of us will probably want to go into a co-working space just to get out and have that social environment. So.... You might see the "WeWorks" help fill in some of the gap that big companies leave behind.

I feel like this will vary from city to city too. I posted in another thread on my personal perspective from Denver. Our housing costs are getting crazy here (not compared to San Fran of course) where our average SFH has hit $625k now and no end in sight. I moved here for a job in Boulder, but if I could live anywhere, I would either do digital nomad, or Chicago. So, some cities may empty out, but others may fill in a bit.

Honestly though, there's so many degrees of freedom. For all we know, companies may reign back things after Covid is over, and this won't be as widespread as we think in a couple years.

If the Rust Belt is any indication, many of them will sit there vacant in the hopes that someone comes in with a redevelopment plan. Even if that takes years.

I don't know about other Rust Belt cities, but ours has seen a wave of conversions of offices, warehouses, factories, and some hotel rooms to residential or mixed-use in desirable areas. Even though the population has been flat, there is still a demand for decent rentals and also for low-end and subsidized housing.

A big example is that DC developer Doug Jemal has taken ownership of Buffalo's largest office building, and several others, and is in the process of converting or adding hundreds of new apartments downtown in addition to attracting commercial tenants and retail businesses. He recently proposed new construction replacing parking lots in addition to the ongoing conversions, citing high unmet demand for downtown housing.

I don't know how suburban offices may manage, but I suspect that centrally located areas will be able to profitably backfill with residential.

That works with old buildings (such as Statler) that before Covid and WFH, were no longer competitive but I can't see more modern office buildings (post 60's) with huge footprints being so easily converted or in demand.

True in general. Buffalo and other Rust Belt cities do, however, usually have a big supply of underused older buildings. Buffalo does have a modern office building, One Seneca, completed in the early 1970s, with 115 recently completed apartments added. Jemal is also considering apartments for the upper floors of the 40 story building, but so far has been filling it with commercial tenants. So with the right building in the right place it is possible, but certainly may not be suitable everywhere.

the large, deep floorplates of post-war office towers can be a challenge for residential conversion, but it certainly can be done.

here are two examples from chicago off the top of my head:



55 E Monroe (the upper 10 floors were converted to residential):

https://images.skyscrapercenter.com/...overall_mg.jpg
source: https://www.skyscrapercenter.com/bui...t-monroe/14135




The Montgomery (former Montgomery Ward HQ tower converted to residential)

https://images.skyscrapercenter.com/..._aerial_mg.jpg
source: https://www.skyscrapercenter.com/bui...ntgomery/10312

If companies downsize and promote wfh, the first casualty will be suburban office parks. That was already a trend pre-pandemic. it would likely accelerate if this becomes a trend.

25% of the time I enjoy working from home, but hate it the other 75% of the time. I am just not as creative or productive working from home, and I dislike the lack of separation between work and nonwork spheres (which might not be an issue for those living alone, or at least for those that don't have children, but I have a wife and two kids which make noise and badger me...the type of work I do requires periods of intense concentration, which I find difficult when there are interruptions).

I suspect that the downtown office is here with us to stay, albeit perhaps only 80% of what it was, with a lot more flex time workers and people working from home on a more or less permanent basis.

I'm single and working from home lately as well, but even I get distracted by the lack of work-non work separation. My cat is always bugging me for one thing or another, and I often find myself getting distracted by various things I need to do in the house.

Between constant zoom calls and my wife, I can only really get deep work done between like 10 pm and 2 am...

As I've said before, the freedom to work from home is a great option for the sake of flexibility - on those days where you have to stay home with a sick kid, or have to get to an appointment in the middle of the day, or where you're just not that busy - it's good to be able to work remotely instead of having to book the day off.

However, any time you actually have to be productive or interact with coworkers it's far better and more efficient to do so in the physical workplace (for most people, in most jobs - there are of course exceptions). Especially so if you have a job that requires specialized equipment or a heavy-duty computer rig that's hard to replicate at home.

For those reasons, offices aren't going anywhere.

St. Louis has too. St. Louis has one of the highest conversion rates of former office buildings and warehouses into multifamily housing with 50 or more units in the country. I'm actually living in a unit in a former office building myself. This also isn't taking into account when the conversions created new hotels.

The thing is though is that we still have a handful of some very noteworthy buildings that are waiting for their moment in the sun. It would appear that Covid has, at bare minimum, delayed those projects for now.

I too get distracted heavily at home, but if I was in a co-working space where I could get out of the house and into an environment where I am working, then I can be productive again. It doesn't necessarily have to be in-person with my co-workers. We are already spread out over three different time zones, so I have gotten used to that.

I live in a 2-br rowhouse with my wife and our kindergartner attending school on zoom in our living room and the only thing that distracts me working from home is skyscraperpage forum. But it was the same in the office.

There's no housing crisis. And the institutions that own/build office space are betting on some form of return to normalcy in the near-term. So the scenario is probably far-fetched.

Also, a lot of office space doesn't make good residential space.

In fast-growing urban cores, one factor will be demand for new building sites. If there's less demand for new offices, then housing developers might have an easier time finding sites, with potentially some moderation on prices.

I lived in the second tallest building in Norfolk, which was the Bank of America building from the 1960s until 2016. It was converted into apartments and was a success as far as I could tell. The third tallest building, the Norfolk Southern building, is also getting looked at as I speak because NS is about to leave Norfolk.

So who knows, it could definitely make a dent.

Remote work won’t be permanent, case closed

100% remote, maybe.

But even before COVID I worked regularly with people who lived several states away from their "home" workplace, and only occasionally travelled back to their offices.

This is especially true for people that are required to do frequent travel as part of their job. Their "office" can be literally anywhere.