Boston proposing bold tax breaks for office-to-residential conversions.
Boston proposing bold tax breaks for office-to-resi conversions
Downtown building owners could get exemption up to 75%
Mayor Michelle Wu has proposed property tax breaks of up to 75 percent over 29 years for downtown office conversions, the Boston Business Journal reported. It’s the first financial incentive the city has proposed providing to office owners.
The catch is that it will be a limited time offer. The city expects to start taking applications in the fall, but close the door at the start of the following summer. Construction on approved projects will need to start by Oct. 25 if the owners don’t want to hand back the entire tax break.
Terms of how the tax break functions would be negotiated on a case-by-case basis. They will be implemented through payment in lieu of taxes agreements with the city and the Boston Planning and Development Agency.
Design firm Gensler recently increased its estimate of the number of buildings in downtown Boston that could warrant a conversion. In a study of 90 properties, Gensler found 30 percent to 40 percent may be worth a conversion. That could yield as much as 5 million square feet of conversions.