Pew/Gensler Study: Converting Houston Office into Co-Housing

HOUSTON – (By Cynthia Lescalleet, Realty News Report) – Could office-to-residential conversion be a viable tool in creating more affordable housing in downtown Houston? A just released feasibility study by The Pew Charitable Trusts and Gensler showcases and analyze how such a project might be part of the solution to housing’s undersupply.

Given Houston’s low regulatory barriers to building and its high office vacancy rate, Pew selected the Bayou City as one of five in the country with good potential for a co-housing approach to conversion, said Alex Horowitz, project director of the trust’s housing policy initiative. Such a project would address the pressing need for budget-strapped housing and also repurpose languishing office inventory.

For the study, the project considered lower income residents, be they in the service industry working in the area, students, temporary workers, new arrivals getting familiar with the city, and those on fixed income, such as retirees. The building’s location is near jobs and transit to get to them, further reducing tenant expenses as worker transportation costs are second to housing.

The co-housing concept goes by many names: micro housing, “apodments,” even dorm-style housing. They feature small and secured private units that share common facilities, from bathrooms and showers to kitchens and laundry facilities.

As an alternative to conventional office-to-residential conversions, “This is a jumping off idea,” said Gensler’s Brooks Howell, principal in the Houston office of the global architecture, design and planning firm.

In the study, Gensler assessed a non-disclosed 24-story Class B property downtown, where much of the office inventory is more than 50 years old. That means they’re possibly eligible for grants, tax credits and subsidies.

That said, the studied building’s co-housing buildout sits at $134,000 per unit vs. $325,000 per unit for conventional conversions, noted Gensler’s Wes LeBlanc, principal and strategy director.

Construction costs are lower in the conversion because more of the original structure, mechanicals and plumbing can be retained, Brooks noted.

And with tariffs now a factor, adaptive reuse requires fewer new building materials, Horowitz said.

On the tenant side, meanwhile, the rejiggered tower could accommodate nearly 1,200 residential units.

A projected rental rate for the studied property lands in the range of $700, compared to the city’s median rate of $1,297, which is up about 14 percent since 2021, the study indicates. The co-housing rent includes 24-hour security, utilities, access to the tower’s fitness center, and maintenance of all those shared facilities.

LIVING ON THE LEVEL

The proposed buildout’s first level holds a lobby, management office and 10,000 SF of retail. Next up, three levels of parking and one level of office space and fitness center for all tenants. Levels of identical floorplans finish out the structure.

Each residential floor features 60 small rooms – 141 SF to 227 SF. (By way of comparison, a typical studio apartment averages 440 SF.) Soundproofing and lockable wooden-core doors separate rooms equipped with a twin bed, nightstand, nook with mini-fridge, microwave and shelves, and a closet.

At the core of the floorplan are clusters of living rooms and plumbing-based functions: six kitchens, 10 shower rooms, 12 toilet rooms and two laundry facilities.

Gensler’s LeBlanc said there is flexibility in the concept and it is scalable.

With ongoing interest and conversations by developers and political entities about housing efficiency and affordability, “Here’s a way to do something,” Horowitz said.

Similar Pew/Gensler assessments of cities where micro conversions have economic viability amid high rent and housing shortages include Seattle, Minneapolis, Denver and Los Angeles.