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**Portland Approves Office-to-Residential Loan Forgiveness Program**
Prosper Portland, an agency focused on fostering economic growth and opportunity in the city, has approved a new pilot loan forgiveness program aimed at converting underutilized office buildings into housing.
The program is designed to encourage developers to repurpose vacant commercial spaces into much-needed residential units. It offers financial support in the form of forgivable loans—up to $60,000 per unit for embodied carbon savings and an additional $25,000 per unit for energy efficiency improvements.
These loans will carry a 2% interest rate and a 10-year forgiveness structure. As long as the development project maintains tenant rents within 60% to 120% of the local median income and remains in good standing, the principal balance of the loan will be forgiven incrementally over the 10-year period.
This initiative is part of a broader effort by the City of Portland to address declining office occupancy rates through adaptive reuse of commercial buildings. Converting offices to residences has been identified as a viable strategy to revitalize downtown areas and address housing shortages. Earlier this year, Portland was ranked among the top U.S. cities in terms of feasibility for office-to-residential conversions.
The loan forgiveness program reflects a growing emphasis on sustainable urban development and supports a more flexible and resilient use of city infrastructure.
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