A New Vision: Flex Co-Living Conversions to Support Housing Affordability
Introducing the Office-to-Flexible-Co-Living Conversion
What if CRE could reintroduce a version in the form of a modern, flexible co-living model, and what if vacant office buildings are the key to making it feasible? The reintroduction of flex co-living residential typologies has the potential to:
Reduce the costs of additional residential inventory.
Increase the supply of available housing to lower-income renters.
Alleviate some of the negative impacts of long-term demand changes for office properties.
Recently, Gensler partnered with The Pew Charitable Trusts (Pew) to develop a flexible co-living concept to assess its potential as an office building conversion. An initial study was conducted for three cities — Denver, Minneapolis, and Seattle. The team selected these three cities because they have high median rents, a high rate of homelessness, and high downtown office vacancies. Most importantly, they have minimal or no regulatory barriers in place that would make these types of renovations illegal or too expensive.
Gensler and Pew identified building typologies in each market that are suitable for co-living conversion and developed floor plans (prototypes) for each, factoring in mechanical, electrical, and plumbing systems. Each floor features private, “micro-units” with locks along the perimeter, and shared kitchens, bathrooms, laundry, and living rooms in the center.
Partnering with Turner Construction, conversion costs were examined for renovations and the cost of labor. Additionally, the team developed an operating pro forma and financial feasibility analysis to assess the co-living conversion model’s viability as a real estate model.
Results and Findings
Utilizing the plumbing from kitchens and restrooms that are typical in office buildings, rather than adding new elements to individual units, reduced construction costs by 25% to 35% compared to conventional office-to-residential conversions on a cost per sq. ft. basis. The units offer private, secured rooms and large windows for every resident and can accommodate space for three times as many apartments as a traditional residential building.
The Denver Building Study
Converting vacant buildings in urban areas maintains accessibility to jobs and public transportation while the flexible co-living concept unlocks additional office-to-residential conversion opportunities. Policymakers can consider supporting the implementation of office-to-flexible co-living conversions due to the outsized impact that the concept has on housing production in an area of critical need. If successful, cities will be able to deliver low-cost housing in a much more efficient and cost-effective manner, providing thousands of secure, modern, and attractive homes to our nation’s downtowns. From a financial feasibility standpoint, Gensler’s study found that the concept may generate an anticipated rate of return, but it most likely willl require some degree of public subsidy. However, the units produced per subsidy dollar would far exceed the impact of existing affordable housing delivery models. Click below to download the Denver Building study:
https://www.gensler.com/doc/pew-gensler-flexible-co-living-housing-study-denver.pdf
In Conclusion:
Adding large amounts of this low-cost, downtown housing would provide a much-needed option for students, service-industry workers, young professionals, veterans, etc. It would also reduce homelessness. And because of these units’ small size, the current low prices for office buildings, and the efficient layout, this housing could be created near jobs and transit at a fraction of the cost of traditional houses or apartments.
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