Earlier this month, Denver's downtown office vacancy rate rose above 30% for the first time in the decades. Like many cities reeling from the pandemic and grappling with housing crises, city leaders have talked about the possibility of turning vacant commercial office buildings into apartments.
Much of that conversation has focused on downtown office buildings. Earlier this year, the city released a report identifying 16 buildings downtown that could be good candidates for conversion, and has been running a pilot program helping owners and developers through the planning process.
Now, a similar pilot program targeting underutilized commercial buildings is open to owners in East Colfax, between Broadway and Yosemite St. To qualify, the building must be within those boundaries and be more than 30 years old. The owner and developer must plan to convert the building from commercial or industrial into residential or a new commercial use.
"These pilot programs will support projects undergoing conversion to a new use or purpose by providing direct assistance to business owners, developers, and property owners as they navigate the City and County of Denver's review and permitting process," wrote the Denver Department of Community Planning and Development about the program.
Whether or not a building is a good fit for commercial conversion depends on a number of factors including accessibility, layout, windows and walkability in the area. Parking is particularly a factor in a city like Denver with a limited public transit network.
Financing is also a key factor in potential adaptive reuse projects. While commercial real estate continues to lose hundreds of millions in value, adaptive reuse projects can get expensive. Meanwhile, the residential real estate market brings in lower profits than commercial properties at their peak.
But according to experts on reuse, reusing existing buildings are still typically cheaper projects than building from scratch, especially with supply chain issues on construction supplies. Reusing existing materials is also better for the environment.
Interested owners and developers can apply to the pilot program for East Colfax online.
