The trend of converting office spaces into residential properties has gained traction among international investors in the U.S. commercial real estate market, according to AFIRE’s latest International Investor Survey Report. The report reveals that 90% of respondents plan on converting existing office buildings into residential units within the next five years.
Moreover, survey participants believe that over a third of their U.S. portfolio’s office assets will require upgrades to meet future occupancy demands for improved health and sustainability amenities as well as modern work style preferences. Investors are also exploring various other options for repurposing offices, such as industrial storage/data centers (72%), hospitality/leisure (69%), and vertical farming (33%).
According to Gunnar Branson, CEO of AFIRE, this survey reflects institutional investor sentiment towards the U.S. market at the end of 2023.” Despite ongoing uncertainties, long-term focused institutional investors see potential in realigning their portfolios to cater to changing asset class demands – particularly for more residential properties in American cities.”
This article was originally published on Connect CRE.
