Creative Approaches to Urban Zoning

Have you ever felt like you were living at work? Now, you might be. Post-COVID-19, more people are working from home than ever before. Even after recent return-to-work orders, office buildings are still only seeing 63% occupancy. Office to residential building conversions have been proposed as the creative solution to repurpose unused buildings and revitalize abandoned downtown streets. In Montgomery County, Maryland, the county instituted a tax abatement called PILOT, or “payment in lieu of taxes,” under which office buildings converted into residential spaces are wholly exempt from real property tax for twenty years. However, many cities have land-use restrictions in place that may force developers to go through the time-consuming and costly process of requesting a variance, an exception to zoning regulations. So, are cities actually being revitalized through office to residential conversions when there are strict land-use restrictions in place?

D.C.’s last major zoning regulations overhaul was in 2016 with the adoption of the Zoning Regulations of 2016 (ZR16) to modernize the existing Zoning Regulations of 1958 (ZR58). The regulations were re-organized and amended in 2023 to include a naming convention for some zones. According to the D.C. Zoning Handbook, the main purpose of residential zoning is “to provide for stable residential areas suitable for family life and supporting uses.” Most recently, in March 2025, D.C.’s Office of Tax and Revenue approved emergency legislation that allows an office property being converted to become reclassified as a residential property upon issuance of a building permit. Previously, a building could only be reclassified when the construction was entirely completed and when the building was in actual use.

To balance the dispute between revitalizing urban downtowns and maintaining the state’s authority to regulate zoning regulations, it is helpful to turn to Village of Euclid v. Ambler Realty Company. In this case, a realty company owned 68 acres of land in the town of Euclid, Ohio. The town council passed a zoning ordinance that divided the town into several districts. The realty company, whose land spanned several districts, was then significantly restricted in the types of buildings it could construct on the land. The Supreme Court concluded that the town had not exceeded its police power or violated the realty company’s constitutional rights, reasoning that zoning regulations should be upheld as long as there is some connection to “public health, safety, morals, or general welfare.” In this case, where the city is split into distinct zones by type of land use that is allowed—such as residential, commercial, retail, or industrial—the separations are necessary to “make it easier to provide fire apparatus…increase the safety and security of home life; greatly tend to prevent street accidents…decrease noise and…preserve a more favorable environment.”

Supporters of the District’s latest regulations may turn to the Euclidean zoning doctrine for insight into balancing the potentially competing interests of state authority and the need for urban revitalization. Applying the public welfare test to the zoning ordinances instituted by the D.C. Office of Zoning, the base and overlay zones of D.C. are clearly for public welfare because they protect peoples’ right to enjoy their home, without risk of raising their family next to an industrial factory. More so, D.C.’s zoning laws protect the historical value of the city by imposing a strict building height limitation to preserve the landscape. Additionally, the recent emergency legislation on the part of the Office of Tax and Revenue seems to be pushing for adaptive reuse by allowing building reclassification much earlier in the conversion process, which in turn may incentivize developers to consider taking on more office to residential projects.

Although the red-tape surrounding the District’s zoning may make it more difficult for developers to effectuate office to residential conversions, D.C. is properly appropriating its authority to balance public welfare with the need for adaptive re-use projects. Under these regulations, downtown areas may be revitalized, even with land-use regulations in place. As such, the District may look to Montgomery County, Maryland to adopt similar incentivization policies to facilitate restoration of previously commercial zones and add more available residential space to the D.C. housing supply. So, you may just be living in a converted office.

Alicia Casciano and Hemingway Jernigan are rising second-year law students at the American University Washington College of Law.

Image: Martin Falbisoner, ADAC-Zentrale, Munich, March 2017-05.