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When the economic recession of the 1980s hit Los Angeles, bankrupt companies departed the city’s downtown and left office buildings vacant. So, in 1999, grappling with the reality of an empty neighborhood, the city passed an adaptive reuse ordinance – a municipal law facilitating the conversion of old, vacant or economically distressed buildings into apartments and live-work units. Suddenly, developers had a pathway to turn historic office buildings and warehouses downtown into housing and hotels – a process many cities are now undertaking as their downtown cores empty out in the wake of COVID-19.

The RAND Center on Housing and Homelessness in Los Angeles found that construction for adaptive reuse projects cost on average around US$340,000 per unit, 48 per cent less than new construction projects.Paul Turang

“This bold policy reform streamlined the efforts to make converting a very old building to a new use pretty easy,” explains Roberto Vazquez, an architect and project director at the L.A.-based firm Omgivning, which specializes in adaptive reuse, the process of converting existing buildings for new purposes.

“We’re breathing in new life into these underutilized buildings,” he says. “It not only helped convert the [downtown] area from being run-down and dilapidated, it beautified it and gave a sense of purpose and belonging for the residents here.”

Among other projects, in 2015, the firm helped transform a six-storey 1920s office building into 58 residential loft units and another six-storey warehouse (previously occupied by the Singer sewing machine company) into six units – one per level. The renovation of a 1.8 million-square-foot Sears distribution centre near downtown L.A. is currently underway.

Mr. Vazquez says the ordinance – which only applied to buildings built downtown – has been hugely successful and, in 2003, was expanded to include other neighbourhoods in L.A., such as Koreatown and Hollywood.

The principles behind LA’s ordinance have grown in popularity amid the pandemic. As remote and hybrid office structures remain prominent well into COVID-19, cities worldwide have been forced to rethink commercial properties in their downtown cores. In 2021, the City of Calgary, which was already reeling from the oil industry’s downturn after 2014, announced plans to spend nearly $1-billion over the next 10 years on incentivizing office tower conversions, building infrastructure for bikes, pedestrians and green spaces. Around the same time, the city of London, U.K., inked a similar plan to turn emptied offices in its central business district into 1,500 apartments by 2030.

And housing isn’t the only option for adaptive reuse.

Mr. Vazquez says that data storage centres are also being introduced, especially for buildings, or parts of buildings, with limited natural light. Former office buildings could also see new life as last-mile e-commerce warehouses are situated closer to residents, offering shorter delivery times.

But not all owners of office buildings are eagerly jumping into adaptive reuse.

Karen Chapple, director of the School of Cities at the University of Toronto and a professor in the Department of Geography and Planning, says that office building owners in downtown Toronto are still taking a “wait and see” approach when it comes to conversions. Separately, developers have argued that the city faces difficulties with zoning laws and regulatory bottlenecks that make converting old buildings an uphill battle.

“Some of these folks are going to be carrying vacant office space for a long time,” Prof. Chapple says. “It very quickly becomes a situation where you’re losing a lot of money.”

Los Angeles passed an adaptive reuse ordinance, which is a municipal law facilitating the conversion of old, vacant or economically distressed buildings into apartments and live-work units.

She stresses that transforming a central business district takes more than one forward-thinking developer. “I see this as a collective action problem,” Prof. Chapple says. “The real estate sector should get together with the city governments across Canada and say, ‘Hey, we have to do something about this. We have to remake our downtowns.’ I don’t think that acknowledgement or realization has really occurred yet, in either the public or the private sector.”

But building owners and developers’ hesitations are understandable; converting an office space into housing can be a daunting task. Floorplans need to be reconfigured, along with plumbing, HVAC and natural light. For the Sears distribution centre in L.A., about 150,000 square feet of concrete is being removed to create light wells in the interior of the building, which older office spaces and warehouses notoriously lack.

Omnigivning says their projects range widely in total overall costs, but declined to state a precise figure. The firm, however, notes that a recent report by the RAND Center on Housing and Homelessness in Los Angeles found that construction for adaptive reuse projects cost on average around US$340,000 per unit, 48 per cent less than new construction projects (or, US$164,000 less per unit). When utilized fully, the approach could produce between 72,000 and 113,000 units of housing across Los Angeles County, the report argues.

The pandemic’s transformation of business corridors offers an opportunity for cities to build back better – but it also comes with risk of displacement. Willow Lung-Amam, an associate professor in the Urban Studies and Planning Program at the University of Maryland and director of the Small Business Anti-Displacement Network, says cities should be intentional about ensuring that adapted former business districts are affordable and welcoming for mom-and-pop shops. LA’s adaptive reuse ordinance, for instance, has been both highlighted for its potential to alleviate housing strain and criticized for its potential to displace low-income tenants.

“Small businesses are absolutely essential to the character, identity and economy of our neighbourhoods,” Prof. Lung-Amam explains. “When all of our cities become large chain restaurants and retail stores, we’re losing a lot of tax dollars and character-defining features. All of a sudden, Vancouver looks like New York looks like Chicago.”

The same principle extends to housing, she says; cities should adopt strategies like equitable distribution policies that use laws, tax credits, fee waivers and the like to mandate or incentivize that a certain number of units in newly adapted buildings be affordable housing.

“[We should] ensure that families can actually access that housing, that it’s not all being converted to one-bedroom condos,” she says. “That there are intentional policies around deep affordability.”