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Conversions11 min readSeptember 1, 2024

The Manhattan Office Conversion Pipeline: What's Actually Happening

Beyond the headlines, a practical assessment of which conversions are moving forward, which are stalled, and what separates success from failure.

Office-to-residential conversion has been the topic du jour since remote work reshaped demand. But converting headlines into closed deals requires understanding the real constraints.

What's Actually Converting

  • Pre-war buildings with smaller floor plates and generous window lines
  • Buildings acquired at significant discounts to replacement cost
  • Locations with residential demand regardless of market conditions
  • Sponsors with conversion experience and patient capital

The 467-m Tax Abatement Factor

The 35-year tax abatement fundamentally changes conversion economics. Projects that pencil without it are rare; projects that pencil with it require hitting strict timeline requirements.

Lessons from Active Projects

Our work on multiple conversion advisory engagements shows that building selection is 80% of the battle. The right building in the wrong hands fails; the wrong building in the best hands still fails.

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