**Portland Approves Office-to-Residential Loan Forgiveness Program**
Prosper Portland, the city’s economic and urban development agency, has approved a new loan forgiveness initiative aimed at transforming underutilized office space into much-needed housing. The pilot program is designed to support developers undertaking office-to-residential conversion projects, offering significant financial incentives to encourage sustainable and affordable development.
Under the program, eligible projects can receive up to $60,000 per residential unit to account for the savings achieved through embodied carbon, as well as up to $25,000 per unit for implementing energy efficiency improvements. These loans will be structured as a 2% interest, 10-year forgivable loan—provided that project performance standards are met and unit rents remain within 60% to 120% of the local median income. The loan balance will be forgiven annually in equal parts over ten years.
This initiative is part of a broader citywide strategy to revitalize Portland’s commercial real estate sector by repurposing vacant or underused office buildings—one of several approaches being considered to address the changing dynamics of downtown real estate. Earlier this year, Portland was ranked among the top ten U.S. cities for office-to-residential conversion feasibility, highlighting its potential as a leader in innovative urban redevelopment.
The program illustrates Portland’s commitment to sustainable growth, housing affordability, and economic resilience as it continues to adapt to post-pandemic shifts in workspace demand.
