Phoenix ranks 13th for office-to-apartment conversions as 1,550 units take shape Article originally posted on Phoenix Business Journal on March 25, 2026 Phoenix ranks No. 13 among the nation’s largest pipeline of office-to-apartment conversions. RentCafe tracked 1,550 units being converted in the metro, according to its newest report released March 24. At the beginning of 2026, 90,300 apartments were in the process of conversion nationwide, up 28% from 70,600 a year earlier, according to the report. Office conversions now account for 47% of all future adaptive reuse projects nationwide, the report said. Financial pressure and government-backed incentives also are accelerating conversions. With about one-third of U.S. office loans set to mature by 2027, many owners face mounting pressure to act on underperforming properties, according to the RentCafe report. One office-to-apartment conversion project getting substantial attention over the years is One Camelback, at the southeast corner of Central Avenue and Camelback Road in uptown Phoenix. The lender had foreclosed on the property while it was in the process of being converted to apartments. Then on Dec. 4, Mesa-based Kinella Capital LLC bought the 11-story tower for $36 million, according to Tempe-based real estate database Vizzda LLC. The property was 80% completed when Kinella bought it, said TK Stratton, founder and CEO of Kinella Capital. He expects to begin leasing by the fourth quarter of this year. Before embarking on this office-to-apartment conversion project, Kinella had purchased townhome units that originally were part of the Hilton Phoenix Resort at the Peak, paying $11.3 million to Fortress Investment Group in November 2024, according to Vizzda. A month before that, Fortress had sold the resort and hotel for $39.5 million to Phoenix-based Pivotal Group. Since then, Kinella renovated the townhome portion of the property into apartment units. Called Views at The Peak, the 78-unit property is about 97% occupied, Stratton said. Monthly rental rates range from $1,900 to $2,400. Meanwhile, a group of partners is quietly gobbling up office space surrounding the former Metrocenter Mall redevelopment project, investing $400 million to convert existing space into 1,786 apartment units. As part of that investment, Foundation 8 LLC plans to create 715 rental units at Canyon Corporate Center, where a garage is being turned into 94 units and two office buildings will be converted to 271 units. Another 350 homes are planned on nearby vacant land in the future. That office complex is behind The Sheraton Crescent, where the group will invest $120 million to convert the shuttered hotel into 258 apartment units. Find Complete Article Here: https://www.bizjournals.com/phoenix/news/2026/03/25/city-ranks-13-for-office-to-apartment-conversions.html