Apartment developers target nonresidential buildings

The diminishing volume of quality multifamily development sites will influence more developers — especially local firms — to target conversion opportunities that involve transforming aging factories, schools, office buildings, warehouses and churches into rental product.

A number of these aging buildings are infill-located or in submarkets that have undergone recent gentrification. By saving the core or shell of a building, incorporating existing interior features and obtaining various available tax credits, developers can save money on project costs.

Additionally, the time frame for a conversion project is typically shorter — 12 to 15 months — than building a new project from the ground up.

The highest volume of apartment conversion projects will occur in the Mid-Atlantic…