Eviscerating a century-old office building and refashioning it into apartments is no easy feat. Older offices are nonpliable, stubborn things, riddled with secret problems and outdated floor plans. But the hassle was worth it for Centennial Yards Company, the developer behind a 162-unit project called the Lofts at Centennial Yards South, a remake of half of the long-vacant Norfolk Southern Buildings. The adaptive-reuse lofts were the first piece of the gargantuan redevelopment of downtown’s Gulch to open in 2021. And they’ve been almost fully leased since. “It’s impossible to replicate the character of a 100-year-old building,” said Ben Reeves, vice president of transaction strategy for the company. “The cast-iron detailing, high vaulted ceilings, terrazzo marble—these details aren’t part of current-day design.”
Atlanta lags behind cities such as Washington, D.C., and New York when it comes to office-to-residential conversions. But that could change in downtown’s capricious, postpandemic urban environment, where many companies need a fraction of the office space they used to.
As a pioneering example, Krog Street Market developer Paces Properties spent $55 million in 2015 to remake a vacant, 20-story tower on Piedmont Avenue into more than 300 rentals. Similar conversions have been discussed for the empty 100 Edgewood high-rise near Georgia State, and the foreclosed, six-tower, landmark Peachtree Center office complex. In October, the city made headlines in announcing it will purchase a 41-story, largely vacant skyrise near Five Points from the state for $39 million—with plans to convert it to hundreds of “deeply affordable” apartments, chipping away at Mayor Andre Dickens’s goal of adding 20,000 affordable homes this decade.
Today, downtown’s office vacancy rate hovers around 20 percent. Particularly ripe for conversion is class B or C office stock, or spaces that might be dated and underused. Downtown has about 4 million square feet of such space—double what’s found in Midtown and Buckhead. If even 20 percent of that were converted to housing, it would yield roughly 1,000 more units, said Alena Green, director of economic development for Central Atlanta Progress and Atlanta Downtown Improvement District. That’s no drop in the bucket, considering downtown has 11,000 multifamily housing units total today (with 30 percent of them set aside as affordable). Conversions are notoriously expensive, said Green, but older buildings can qualify for historic tax credits to help finance makeovers.
“Downtown’s housing stock has [increased] about 30 percent over the past five years, not including student housing,” said Green. “It’s not the last nut to crack—we’ve got a couple—but I think a pretty significant one when we talk about creating a livable city.”
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This article appears in our January 2023 issue.