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New State Bill Would Incentivize Office-to-Housing Conversions

A new bill authored by Assemblyman Matt Haney would prevent cities from stalling or killing the conversion of empty office space into housing in an effort to utilize the state’s emptying downtowns.

Assembly Bill 1532 would categorize office conversion projects as “by right” developments, relaxing the permitting and review process for housing projects by preventing a city or county from requiring certain permits to convert a vacant office into housing.

The bill is partially spurred by the hundreds of empty offices in downtown San Francisco, which has seen one of the slowest pandemic recoveries in the country among major metro areas.

According to the commercial real estate firm CBRE, some 27% of San Francisco’s offices were vacant at the end of 2022.

“How people work was permanently changed by the pandemic and the downtowns that relied on commuters are starting to look like ghost towns,” said Haney, D-San Francisco. “Turning empty offices into housing is one of the only paths forward to saving our downtowns.”

In addition to preventing local governments from stalling office conversions via the permitting and review process, AB 1352 would also make office conversion projects allowed in any area of a city regardless of local zoning laws.

The bill requires that at least 10% of units in an office-to-housing conversion must be reserved for low- and moderate-income families.

AB 1352 would also create a grant program to partially subsidize office-to-housing conversion in an effort to further incentivize new projects.

“This bill stops the bureaucracy and will allow us to move fast to build desperately needed housing and bring life back to our downtowns,” Haney said.

State lawmakers have yet to refer AB 1352 to a committee in the Assembly. The bill will be eligible for a committee hearing as soon as March 20, its 31st day in print.

Source: NBC Bay Area

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