As Boston continues to address elevated downtown office vacancies and an ongoing, critical housing shortage, it was recently announced that the City’s Office to Residential Conversion Program (Program) would be extended through December 31, 2026. The Planning Department recommended and received approval for the extension of the Program during the December 2025 meeting of the Boston Planning & Developmental Agency (BPDA).

Applications for conversion projects must be submitted by December 31, 2026, and construction must begin by December 31, 2027, in order to qualify for the Program.

Like most American cities, Boston experienced a sharp decline in daily office use following the COVID-19 pandemic, with an expansive shift to remote and hybrid work models, leaving approximately 20% of the City’s commercial buildings partially or fully vacant. At the same time, the housing supply in Boston remains critically low, resulting in sharp increases in home prices and rents. The Program, launched in October 2023, sought to address both of these problems simultaneously.

In order to qualify for the Program, a project must be an adaptive use of an existing building, and not a demolition/ground-up build. A project must also meet Boston’s inclusionary zoning requirements, including that at least 17% of the units be designated as affordable for households at or below 60% of the Area Median Income (AMI). The conversion must also comply with up-to-date energy codes and building standards, such as the Stretch Energy Code.

Program Incentives

The conversion Program offers exceptional incentives, streamlined approvals and a supportive regulatory environment, including:

Seventy-Five Percent Long Term Property Tax Abatement: Developers converting qualifying office properties can receive a 75% tax abatement for up to 29 years through a payment-in-lieu-of-taxes (PILOT) agreement with the City.

Expedited Permitting and Streamlined Review: The Planning Department’s streamlined Article 80 review process for conversion projects reduces what is typically an 18 month approval timeline to approximately six months, decreasing entitlement risk and carrying costs.

Zoning Flexibility: Eligible buildings can be converted as of right under the City’s Zoning Code, allowing adaptive reuse without the need for permits and/or zoning variances that would typically be required for non-qualifying conversion projects.

Potential State Funding for Large Projects: The Commonwealth’s Affordable Housing Trust had committed $15 million in grants for larger conversion projects of over 70,000 sq. ft., including up to $215,000 per affordable unit, with a $4 million cap per project. While the original $15 million dollars has already been committed to permitted projects, the pool may be re-funded by the Legislature in the coming fiscal year.

Other Funding: The Affordable Homes Act also established a tax credit program for qualified conversion projects, covering up to 10% of total development costs, to be administered by the Executive Office of Housing and Livable Communities (EOHLC) pursuant to its Commercial Conversion Program Guidelines, adopted in August 2025.

Program Performance: Successes and Challenges

A total of 22 applications have been submitted since the Program’s inception, seeking to convert 1.2 million square feet of office space across 27 buildings into 1,517 new homes, including 284 affordable units. Notable pipeline projects include Synergy Construction Group’s 253-unit project at 294 Washington St. and Mahoney Development’s 171-unit project at 50 Congress Street.

Only 251 of those units are actively under construction or have been completed, however, highlighting ongoing feasibility constraints. Despite its promise, office-to-residential conversion is not without obstacles, particularly in Boston, where there are fewer of the prewar, narrow-plate buildings that populate other cities such as New York City and Chicago – buildings that are relatively shallow from front-to-back, with more exterior walls and spacious, defined rooms. Providing natural light and proper ventilation for residential use in Boston’s more modern office buildings, with open concept plans, can be challenging. Affordability restrictions further complicate the financial feasibility of a conversion project.

Key Deadlines

Applications for conversion projects must be submitted by December 31, 2026, and construction must begin by December 31, 2027, in order to qualify for the Program.

MBG Perspective

The Office-to-Residential Conversion Program offers a unique opportunity for developers with the right site and ability to meet its current time requirements.