The Community of Madrid has launched an ambitious plan to address the housing crisis by converting office buildings into subsidized housing with affordable rents. We would like to highlight this innovative measure that will have a significant impact on the city's real estate market.
Urban Transformation: From Offices to Homes
The bill, which is being voted on today in the Madrid Assembly, will allow developers to apply for licenses to change land use from tertiary (offices) to residential (homes). This conversion will be subject to one condition: the new housing must be protected for a period of 15 years, guaranteeing affordable rents.
According to María José Piccio-Marchetti Prado, Director General of Housing and Rehabilitation of the Community of Madrid, the measure aims to "make it easier for owners of office buildings to use them for affordable housing". This transformation will allow the rapid incorporation of subsidized housing into the market without the need to modify existing urban planning.
Once the law is approved, it will enter into force the day after its publication in the Official Gazette of the Community of Madrid. Thereafter, developers will have 2 years to apply for the licenses and 3 additional years to execute the change of use. This means that the new homes could be available on the market in up to 5 years, i.e. by 2029.
The plan presents notable advantages by accelerating the availability of affordable housing in a highly demanded market. However, after 15 years, these homes will lose their protected status and move to the open market, which could limit their long-term impact on the supply of affordable housing.
Between Madrid and Barcelona, there are an estimated 2.5 million square meters of office space that could be converted into housing, which could translate into approximately 20,000 new homes in Madrid and 8,000 in Barcelona. These changes are in line with international trends, where major cities such as New York, London and Paris have already adopted similar measures to convert office space into housing.
From aProperties Real Estate, we see this measure as a key opportunity to contribute to the development of affordable housing in our city and improve the quality of life for many Madrileños. We are committed to actively participate in this process and offer housing solutions that respond to current needs.
For more information on how this plan could affect your real estate investments, please do not hesitate to contact us. We are here to help you navigate this dynamic and changing market.