The residential real estate market in New York generally remains strong even when other markets may falter. After all, there is a limited amount of land available, and people want to be close to where there are career opportunities, transportation and entertainment.
Demand for housing continues to increase, which only serves to put pressure on the market. There is a potential for regular income or a substantial return on an initial investment when adding to the supply of residential properties. Unfortunately, finding affordable properties to develop can prove quite challenging.
Companies seeking to provide the housing that members of the community need may turn to conversion projects that alter the use of existing edifices. While finding vacant lands can be prohibitively challenging in many cases, finding underutilized properties is substantially easier. The downturn in office leasing has left many buildings vacant and eligible for redevelopment. Converting them into condominiums can be a lucrative project.
Condo conversions take time and investment
As fewer companies demand full-time work in office settings, the number of vacant or partially-rented office facilities increases. Some investors and property owners have begun converting these existing buildings into residential properties. Acquiring office buildings can be an affordable solution, but the process involved in converting the space creates its own set of challenges.
To successfully change an office building into a residential building, owners or investors have to complete numerous mandatory steps. In some cases, they may need to acquire properties if they do not already own them. They may need to address zoning by seeking a variance or petitioning to permanently change the zoning.
The structure itself may require changes and improvements to help it align with building standards for residential properties. Then there is marketing and property maintenance to consider. The entire process is likely to take multiple years to complete and could require hundreds of thousands of dollars in investment, if not substantially more.
That being said, condominium conversions can prove lucrative when properly planned and managed. Prospective investors and owners frustrated by vacancies may need help managing the conversion process. Exploring creative opportunities for real estate investment and development can help organizations find new streams of revenue or improve returns on a faltering investment.