Office to Residential conversion.

[investornewbie]

I currently have a commercial building in my family that has been vacant for a number of years. It's currently zoned as office space, however I checked with the city and it can also be zoned for residential units. Is this a viable option worth pursuing? I done some research. I found estimates for the average cost to construct a single unit being around 90-100k. Is this accurate?

 

[Thomas Beyer]

Step 1: phone the city / municipality but if the zoning allows multiple designation then you are probably ok.

Step 2: check parking rules and other code issues with current exterior of building, say roofs, walls, ceiling heights, foundation that are all valuable and ought to be re-used as much as possible

Step 3: talk to a general contractor about your rough plans. I'd say $80/sq ft as a broad ball park, plus or minus 25%, assuming the outside walls, roof and the foundation can be reused.

 

[3canctheayr]

The cost per square foot that Thomas noted should be right in the ball park. It depends how much mechanical infrastructure and other structural changes you may have to do to create residential units.

Some other things to consider are what the rents would realistically be and how much demand there would for people to live in that building. What else is nearby? More residential?, or more commercial? Or mixed?

If you are in a high demand area with high rents such as Toronto, Van, or Calgary, you might be sitting on a potential gold mine.

 

[eddyb1978]

i agree with Thomas.



Another thing to factor in is an approx 8 to 10K of city development fees per unit. Again you need to meet with the city and explore everything ahead of time, some cities may waive the development fees under certain conditions. We did a couple of projects 2 years ago converting rooming houses to Multiplexes and commercial units to residential...



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