Apartment construction has shifted from downtowns to outlying areas since the pandemic as people rethink where and how they want to live because of flexible work arrangements and lifestyle changes.
RentCafe’s just-released Downtown Construction Report provided that insight from an analysis of data for the 50 largest U.S. cities starting in 1990 — including adaptive reuse projects, which have added apartments through older building conversions.
Key findings include:
Washington, D.C., leads America’s largest cities with the most downtown apartments completed between 2020 and 2024 — 23,000 units.
Manhattan, Milwaukee and Kansas City, Missouri, have added large shares of downtown apartments through adaptive reuse — from 24% to nearly 37%.
In the decade before the pandemic, downtown apartment construction peaked but is slower as growth in outer areas increases.
The share of downtown apartments has declined from 39.2% in the previous decade to 34.7% today.
Apartment construction has been slowly losing momentum in downtown areas since the pandemic. Only 34.7% of new apartment completions have been in core areas since 2020, a 4.5% decline from 39.2% pre-pandemic. Adaptive reuse projects also dropped, from 10% of downtown builds in the 2010s to 6% currently.
However, adaptive reuse is going strong in Manhattan, Milwaukee, Detroit and Kansas City, Missouri, which have some of the highest shares of downtown apartments added through conversion, ranging from 18.9% to more than a third.
The peak year for downtown apartment construction was 2019, with 44% of all new rentals added then. Adaptive reuse projects boomed in the late 1990s and 2000s, when they made up 16% of all new apartments in downtown areas.
