Portland City Council Approves Plan to Incentivize Conversion of Vacant Office Buildings into Apartments

The Portland city council has approved a plan to convert vacant downtown office buildings into apartments in an effort to address the city's housing crisis. The two ordinances passed are intended to incentivize office building owners to convert their buildings into residential units.

“Recognizing the enormous cost of office conversions, the City is acting to create greater financial feasibility for conversions that produce additional housing in the central city and drive investment into empty offices for more vibrant neighborhoods in safer and more sustainable buildings,” said Mayor Ted Wheeler. “While this isn’t a silver bullet, it’s a positive tool to overcome structural and financial barriers to reinvestment into buildings and neighborhoods. We continue to seek more state-level financial support in order to achieve scale.”

Ordinances Passed: 

• Exemptions for System Development Charges: Exempts qualifying conversion projects from all System Development Charges up to the amount of the actual cost of the seismic retrofit or $3 million, whichever is lesser. Eligible conversions still must comply with Inclusionary Housing requirements. This exemption will expire and be re-evaluated in July 2027.
  
  
• Adjustment for Seismic Standard: Adjusts the seismic improvement standard for R-2 classified buildings, which is consistent with the level of safety required by other major cities in seismic areas, like San Francisco.

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