Vacant Today, Vibrant Tomorrow: Transforming offices and industrial sites into homes

Across Europe, cities face a shortage of housing while office vacancies are rising. Roelien de Haas, head of project solutions international at Drees & Sommer Netherlands, explains how converting offices and, in some cases, entire industrial sites into residential space can deliver new homes sustainably

In Lenningen, Germany, a new urban district will be developed on a former industrial area the size of more than 31 football pitches. © DLE GmbH

Urban housing markets are under pressure, while vacant office buildings and disused industrial sites remain in central locations. What opportunities do redevelopments offer for European cities and investors?

In the real estate sector, the focus is often on new construction. But for those who look further, it becomes clear that the redevelopment of existing assets offers enormous opportunities. The buildings of tomorrow are often already here. Urban centres are struggling to meet housing needs, while at the same time office buildings and industrial sites are standing empty. In Germany’s top seven cities, 6.7% of office space lies empty, enough to accommodate over 150,000 apartments, and cities like Amsterdam, Paris, and Milan are confronting the same paradox. Converting existing offices or industrial sites into residential use provides a way to address these shortages quickly and efficiently. It’s about using what’s already there rather than constantly expanding into greenfield areas.

What makes these conversions so attractive compared to new construction?

There are several advantages. First, speed: delivering housing through conversions is often faster than new builds, which is critical when demand is urgent. Second, sustainability: repurposing buildings preserves ‘grey energy’ – the energy already invested in construction materials, transport and installation. Avoiding demolition saves waste and emissions, making these projects much more eco-friendly. Economically, conversions make sense too. A vacant office or disused industrial property generates no income, but transforming it into apartments provides long-term, stable rental returns. And finally, there’s the social and urban dimension: conversions allow us to bring life back into underused areas, often in central neighbourhoods, helping create vibrant, mixed-use communities.

What are the main challenges in converting offices into residential space?

Often, there are technical issues such as outdated installations, foundations, or limited floor-to-ceiling heights. Legal and ownership issues may also come into play. On top of that, there is the balance between preserving valuable elements and meeting today’s needs for comfort, sustainability and modern functionality.

How do the challenges differ when redeveloping whole industrial sites?

Industrial sites come with their own set of complexities. There may be contamination from previous activities, structural limitations or noise from neighbouring operations. Even basic infrastructure such as connections to water, sewage, and electricity can require upgrades. Approvals and coordination with local authorities are often more complex, especially when ecological or heritage considerations are involved. As with office conversions, each project requires a careful economic assessment to ensure the redevelopment is financially viable while creating social and urban value.

How does Drees & Sommer support clients in making these decisions?

We guide clients through the redevelopment journey from vision to completion. We start with a feasibility study that considers technical, financial, legal and social aspects in an integrated manner. From there, we provide clear insights into the impact of design choices and sustainability measures.

For office-to-residential conversions, this includes our office-to-residential check, which evaluates technical feasibility, planning conditions, market demand, and financial viability within just a few weeks. This gives clients a comprehensive understanding of whether a project is viable, or if alternative scenarios are more appropriate. The goal is always to unlock the potential of existing properties in a way that is practical, sustainable, and economically sound.

Can you give us a concrete example of a project that illustrates what is possible?

One of the most compelling examples is the former Scheufelen paper factory in Lenningen, Germany. It spans 250,000 m² and is being redeveloped into a vibrant mixed-use district. The project will deliver up to 650 residential units while preserving heritage buildings and re-naturalising green spaces along the Lauter River. About 25 percent of the site is being de-sealed and restored to nature, creating new parks and public areas.

What’s particularly interesting about Scheufelen is how it demonstrates the scale at which industrial sites can be transformed. It’s not just about converting a single building – it’s about creating a liveable neighbourhood with integrated infrastructure, community amenities and ecological As project manager, Drees & Sommer oversees schedules and feasibility, coordinates all parties, and ensures social, environmental, and economic balance. It’s a blueprint for how other European cities can approach large-scale site redevelopment.

Roelien de Haas, Head of Project Solutions International at Drees & Sommer Netherlands

Sustainability seems to be a recurring theme. How is it incorporated in these projects?

Sustainability is central. First, by preserving grey energy, we reduce environmental impact. Second, conversions offer the chance to integrate modern, energy-efficient systems, circular construction methods and renewable technologies. In the case of industrial sites, we can also include ecological restoration, green-blue infrastructure and public open spaces, which enhance biodiversity and community well-being.

From an urban planning perspective, converting centrally located offices and industrial sites into housing reduces commuting distances and reliance on cars, which further lowers CO₂ emissions. We also aim to create social sustainability: mixed-use neighbourhoods with access to amenities, green spaces and public transport foster healthier, more vibrant communities.

How do investors or municipalities know whether a conversion is financially viable?

That’s where the office-to-residential check is invaluable. It combines technical analysis, planning review, market research and financial modelling into a clear, actionable report. Investors can quickly see whether a property can generate stable rental income, what modifications are needed and how long the process will take. If a conversion isn’t viable, we provide alternative scenarios that maximise value, whether through refurbishment, partial redevelopment or a mixed-use approach. The goal is to turn empty or underutilised assets into productive and sustainable urban spaces.

Do you see office-to-residential and industrial site redevelopment becoming a mainstream strategy across Europe?

Definitely. European cities are under pressure to provide housing without endlessly expanding into greenfield areas. Vacant offices and industrial sites represent an enormous untapped resource. With supportive regulations, incentives and subsidy programs, this approach could scale rapidly. But success requires integrated planning, technical expertise and collaboration between investors, municipalities and communities.

We already see momentum building. Central European cities are increasingly exploring conversions and redevelopments as part of their urban strategies. The repurposing of the Scheufelen factory is a perfect illustration: it addresses housing needs, revitalizes a former industrial area and integrates sustainability at every stage. This is exactly the type of solution that cities across Europe will need in the years ahead.