DC is a top city for apartment conversions

Not all new apartment development is new construction, and a report says D.C. is the No. 2 city for apartment conversions, topped only by Philadelphia.

Since 2020, Rent Cafe says D.C. has redeveloped 1,762 new units by repurposing older buildings.

But it hasn’t all been former office buildings. It includes the old Walter Reed Army Medical Center on Georgia Avenue, Northwest, where three buildings have been converted to residential so far at what is now The Parks at Walter Reed. Six other residential buildings at The Parks are either under construction or will be soon.

Of the total number of conversions in D.C., 1,100 new units have been created by repurposing old office buildings, the highest number of office-to-apartment conversions in the country.

Among them, The Wray, a former State Department building in Foggy Bottom, and Watermark, a former General Services Administration building, in Buzzard Point.

Rent Cafe, citing Yardi Matrix data, reports 62% of new apartments in D.C. since 2020 have been created from office conversions, 24% from hotels and 5% from health care buildings.

One hotel-to-apartment conversion is Boathouse. Originally a Howard Johnson Hotel, then a dormitory for George Washington University students, Boathouse is on Virginia Avenue in Northwest across from the Watergate complex.

Alexandria, Virginia, is another hot market for adaptive use, where 955 new units were created from office building conversions since 2020.

“Office buildings have become the most frequent type of building to be converted since 2010, even though they are more costly to convert than hotels,” said Emil Malizia with the Department of City and Regional Planning at the University of North Carolina Chapel Hill.

“This outcome can be attributed to their ample supply in urban locations where demand has been strong,” she said.

Nationwide, Rent Cafe reports a record number of more than 20,100 apartment conversions are to be completed this year, and 41% of them are in former office buildings. Former office buildings comprise one-quarter of future projects in which almost 53,000 new apartment units will deliver in 2022.

Conversions can be good for the environment.

“Perhaps the most compelling reason to choose adaptive reuse for apartments versus new apartment construction is the lower environmental impact, especially if demolition is involved,” Malizia said.

Read Rent Cafe’s full report on adaptive use residential conversions.

Jeff Clabaugh

Jeff Clabaugh has spent 20 years covering the Washington region's economy and financial markets for WTOP as part of a partnership with the Washington Business Journal, and officially joined the WTOP newsroom staff in January 2016.

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