Almost two years after widespread COVID-19 vaccination allowed most of America to reopen, office attendance rates in the countryâs big downtowns remain
below 50%
of their pre-pandemic levels. Even though a predicted âretail apocalypseâ never happened â in fact, retail vacancy rates are near
all-time lows
â the entertainment, retail, and shopping destinations that have revitalized many downtowns in the past 30 or so years are clearly hurting.
This change in work patterns presents a major challenge, and a huge opportunity, for center cities and those who own buildings there. The best solution is simple: radical deregulation of housing markets that will allow people to live in now-disused office buildings cheaply and easily.
BIDEN ADMINISTRATION ANNOUNCES REGULATORY OVERHAUL
National office vacancy rates are near 20% and climbing, while
analysts predict that over half of office space
could be empty by the end of the 2020s. Mass transit system ridership, likewise,
is down
about 30%, while rail systems, which attract far more white-collar office workers, are down a full 37%. And things wonât get better because the work-from-home situation is good for just about everyone. Employers who let their people work from home spend less on office space, while work-from-home employees put in
longer hours
and report higher at-work
happiness
.
But current building and zoning codes make it very difficult to change office space into housing effectively. While standards differ in every locality, most large cities have spent over a century imposing ever-stricter codes intended to ensure decent housing. While well-intentioned, these laws had unintended consequences for people who canât afford or donât want the long list of
things
â windows in every bedroom, cooking facilities, private bathrooms â that are now mandatory. While some people may prefer these amenities, lawmakers should take into consideration that no housing situation is ideal for everyone. Lest we forget, even though sleeping in offices is mostly illegal in downtown Washington, members of the U.S. House of Representatives
can sleep in their offices
, and nearly a quarter of them do at least sometimes.
The solution is pretty simple: Cities that want vibrant downtowns in a world where vastly fewer people come into the office every day should remove most regulations on where people can live to allow quick, easy conversion of office space into living space. While federal subsidies and tax credits
have been proposed
for this purpose, they are only necessary because current regulations make it so hard to use office buildings for housing. If thereâs to be any federal role at all, Congress should look at ways to change block grant and housing assistance formulas to reward cities that make it easier to convert office buildings into housing.
Changing the rules doesnât have to be complicated. While fire safety and basic bathroom facilities should be mandatory anywhere people are going to sleep, thereâs no reason why anything else needs to be or why zoning codes alone should declare any area off-limits for people to live. The long experience of converting warehouses into loft apartments, not to mention the historical preservation movementâs success in the adaptive reuse of everything from power plants to shopping malls, demonstrates that creative architects can make just about any space successful for a wide range of purposes.
Life in Americaâs downtowns will never go back to the way it was before the pandemic. But public policies that provide greater freedom for people to decide where they want to live will succeed, whereas nagging and mandates will not.
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Eli Lehrer is president of the R Street Institute.
