NYC's Conversion Wave Doubles, Then Starts Eating Itself

➤ The Signal

Tax incentives, rezoning, and depressed values opened a genuine adaptive-reuse window in NYC, and developers are running through it: conversion starts have doubled in a year. But the same office recovery that makes the city investable is quietly removing the raw material — every Class A block that re-leases is a building that will never be converted.

Chicago’s Millennium on LaSalle is the test case for the next question: what is a finished conversion worth to an investment-sales buyer?

➤ Implications

The economics favor moving now. Feedstock is a depleting resource, and the best-located obsolete assets get bid first. Underwrite conversion as a time-limited arbitrage, not a permanent pipeline.