More than a year and a half after the COVID-19 health emergency officially ended, the effects are still rippling. Many downtowns were devastated as residents fled to the outskirts seeking more affordable and less stressful environs. Commercial real estate was also affected as telecommuting became the new normal.

Now, a new trend may be emerging.

According to research by the global commercial real estate giant, CBRE, conversions of office space to multifamily housing in the United States have been plentiful in 2024. The company describes it as a “banner year.”

According to the research, 73 conversions were completed so far, and another 30 are scheduled to be completed by the end of the year. The vast majority of conversions are to multifamily residential use, versus other uses such as retail, life sciences, self-storage and hotels.

The trend is heading upward, as the share of conversions to multifamily uses rose from 63% in the first quarter of the year to 74% in the third quarter.

The increasing number of conversions to multifamily housing reflects the convergence of several trends. CBRE points to “incredibly high office vacancy rates and falling asset values.”

Demand for multifamily housing in these tight markets is also very high. For example, CBRE notes that the vacancy rate for multifamily housing in downtowns stands at just 5.3%, while the vacancy rate for office space is nearly 20%.

Cities are also striving to revive downtown areas and turn them into “vibrant mixed-use districts.” They are offering financial incentives, easing zoning restrictions and expediting project approvals to make conversions more appealing to developers.

CBRE expects the trend to continue. The number of conversions in 2024 was a fourfold increase from 2016 when the firm first started tracking the trend, and about a 60% increase from last year. CBRE projects the number to nearly triple in 2025.