Major business districts from Paris to the United States are turning vacant high-rises into residential apartments to combat plunging office demand since the Covid-19 pandemic.
In the French capital’s purpose-built business hub Paris La Défense, public development authorities have unveiled plans to convert up to a fifth of the district’s office buildings into housing. Pierre-Yves Guice, CEO of Paris La Défense, said that the district carries a vacancy rate of 14-15%, prompting a push to diversify the landscape.
Ludovic Delaisse, CEO of the French arm of the Canadian real estate business Colliers, said that demand for office space in Paris has dropped by nearly a third over the past five to six years. Real estate firms like Groupama Immobilier are already leading concrete projects, such as converting the nine-storey Le Diamant office tower into residential apartments.
American cities have raced ahead with similar projects fueled by tax cuts for property developers. New York City led the US pipeline with 8,310 converted flats, followed by Washington DC with 6,533 units, Los Angeles with 4,322 units, and Chicago with 3,606 units, according to a report cited by Europesays.
To accelerate these developments, the DC Department of Buildings and the Council of the District of Columbia have eased planning restrictions alongside tax cuts. In the United Kingdom, similar tax cuts and relaxed planning regulations have created a conversion boom, with Knight Frank reporting that London project numbers sit 60% higher than pre-Covid levels.
Developers face steep structural obstacles, including windowless central floor space, which Paris teams and US planners have occasionally addressed by building interior atriums as light wells. Beyond architecture, regulatory frameworks remain a major bottleneck.
