Photo by James Sanna | Banker & Tradesman Staff / File
A new state tax credit will make $10 million available to developers for housing conversions that receive support from local officials.
The Commercial Conversion Tax Credit Initiative (CCTCI) was established in the Affordable Homes Act of 2024 as a statewide incentive to convert underutilized commercial properties into multifamily housing or mixed-use projects.
This week, the Executive Office of Housing and Livable Communities launched a web site with guidelines and application materials, which are due Sept. 25.
Typical awards will range from $2.5 million to $3 million in fiscal 2025, the Healey administration announced. The credits may cover up to 10 percent of eligible costs.
Both nonprofit and for-profit developers are eligible to apply, subject to approval from the chief elected officer of the municipality.
Projects with 50 or more units, those with existing zoning approvals and those that also receive local contributions will receive priority. Projects must include at least 80 percent market rate units.
Developers must be ready to proceed with financial closings in the first quarter of 2026. EOHLC will give preference to adaptive reuse and rehab projects, but will consider applications for demolition and new construction on a case-by-case basis.
Projects must contain at least 80 percent market rate units.
“This new tax credit helps communities turn empty commercial space into homes – bringing people, energy and small-business customers back to main streets while tackling our housing shortage,” Gov. Maura Healey said in a statement.
The first awards will be announced in late 2025. The tax credit can be applied to construction or rehabilitation, excluding acquisition costs.
In a separate municipal program, Boston offers property tax abatements of 75 percent for 29 years for qualifying projects under its office to residential conversion program.
In June, the Healey administration awarded a combined $7.4 million to a pair of developers for two large office-to-residential conversions in downtown Boston. The projects at 31 Milk St. and 15 Court Square will create a total of 190 units.
And in 2024, Healey announced a $15 million pool of funding for office to residential conversions with affordable components, offering $215,000 for each income-restricted unit in such projects.
