DC metro area leads nation in converting empty offices into apartments

Alexandria working to turn vacant offices into residential living

When it comes to housing, turning unused office spaces into residential ones is the latest trend across the D.C. region. FOX 5's David Kaplan has the story.

WASHINGTON - Our region is the most popular for the wave of the future.

When it comes to housing, turning unused office spaces into residential ones is the latest trend.

According to Rent Café, a site that tracks data connected to rental properties, the D.C. Metro Area converted the most office space to apartments in 2023.

This week, American Real Estate Partners announced they’d begun the conversion process for the old Tycon Building, a 200,000 square foot unused building in the heart of Old Town Alexandria.

In the last year, the developer has cleared all the hurdles to start this construction on what will be called CityHouse Old Town. It will have 200 apartments, according to developers.

FOX 5 spoke with a handful of business owners on Saturday who generally said they were supportive of anything to bring additional foot traffic to the area, especially during the week.

Stitch Sew Shop is nearby. They teach people how to sew and make garments for customers. It's a very hands-on, in-store centric business.

"From a small-business perspective, the more people that we can have in the local area that can easily access us, the better," Janine Spendlove said, "If we’ve got a bunch of office buildings sitting empty and there is a way to convert them, which I know has its own difficulties, but if they can make it work, I think that’s great."

According to Rent-Café, the D.C. region had the largest number of these types of conversions last year, about 10% of all conversions nationwide.

In D.C. itself, commercial real estate firm CBRE estimates 21% of D.C. offices are vacant.

Mayor Muriel Bowser has made this a focus of her plans to revitalize downtown.

This whole conversation is happening amidst the changing work habits post-pandemic and how to maximize growth.

Alexandria Mayor Justin Wilson tells FOX 5 the city was doing conversions like these pre-pandemic, too.

Wilson says other municipalities looking at doing this should work with landowners to promote conversions if it’s a good fit.

"We’re grappling with what a lot of other areas around the country are dealing with, especially in this region, where if that use is not viable, work with the landowner and come up with a viable use for it. In a lot of cases, I think that’s going to be residential and there might be benefits for that but there might be other uses that make sense," Wilson said.

Mayor Wilson adds it’s an efficient, environmentally friendlier way to increase inventory, build a tax base, bring life to an area, and deal with the decreasing demand for office space that isn’t located near public transit.

Wilson also noted people’s transit habits have changed in a world of hybrid work, and these types of conversions are helpful economic drivers.

The developer says CityHouse Old Town should finish its conversion in Summer 2025.