DENVER — Denver is exploring a new option to solve its affordable housing shortage: empty office buildings.
According to the city's Department of Housing Stability (HOST), Denver will be short 44,000 affordable units in the next decade.
"I think housing in Denver, Colorado, has become outrageous for a lot of people," said Diane Lobben, who lives in the Denver Tech Center.
The City of Denver is turning to empty office buildings in order to bridge that housing gap.
Developer Shea Properties is set to convert a vacant 124,000 square-foot office building located at 4340 South Monaco Street in the Denver Tech Center into 143 affordable housing units. The project will include a mix of units for households earning between 30% and 70% of the area median income. Construction is expected to begin in 2025 and be completed in 2026.
This is the City of Denver's first office-to-residential affordable housing conversion since the COVID-19 pandemic.
The City and County of Denver approved up to $29 million in private activity bonds (PABs) to support the project. According to HOST, PABs are tax-exempt bonds issued by or on behalf of the city to help finance projects that serve a public purpose, such as affordable housing.
According to a Q4 report from CBRE (Coldwell Banker Richard Ellis), the world's largest commercial real estate services and investment firm, nearly 25% of offices sat dark across the Denver metro area.
- Read the full report below
Certain areas in Denver are seeing more vacancies than others. CBRE data showed nearly 35% of offices in Downtown Denver are vacant, while 46% sat empty in the Five Points/ River North neighborhood.
Andy Proctor, director of MSU Denver's Affordable Housing Institute, said while conversions are a great use of space, developers run into challenges to make these kind of projects happen. From re-designing the space to difficulties with the rezoning process, Proctor said it isn't an overnight solution.
"I mean, think about going to your office or going to my office. There's a bathroom down the hall, but there's not a configuration that says every single office has a bathroom," explained Proctor.
In addition to the South Monaco Project, three buildings in Uptown Denver are part of a pilot program to convert commercial office space into multi-use residential space.
- View the buildings included in the Adaptive Reuse Pilot Program in the map below
A spokesperson for the City of Denver's Planning Department said there's a designated project coordinator to help building owners transform their property into a living space.
"I'm not sure if it's going to be a trend, but I think it's a really efficient use of buildings," said Proctor.
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