Massachusetts has awarded $15.3 million in Commercial Conversion Tax Credit Initiative funding to five projects that will transform vacant, underused and obsolete commercial properties into 856 rental homes across Boston, Dedham, Springfield, Westford and Worcester. The awards are intended to support housing production while advancing downtown redevelopment and adaptive reuse.
The awards are part of the Commercial Conversion Tax Credit Initiative, established through Massachusetts' 2024 Affordable Homes Act. The program is designed to help finance construction and substantial rehabilitation work when commercial properties are converted primarily to residential or mixed-use developments.
The funded projects include Historic Clark Block Rehabilitation in Worcester, which will create 48 rental homes through adaptive reuse of a historic former retail building. In Westford, Redgate will demolish an obsolete hotel and develop 300 rental homes within the community's MBTA Communities multifamily overlay district.
In Springfield, McCaffery Interests will adaptively reuse four historic downtown buildings for 99 rental homes and ground-floor retail. Nordblom Development will replace two obsolete commercial buildings in Dedham with 154 rental homes near the Dedham Corporate Center commuter rail station.
In Boston, Synergy will convert a historic office building at 294 Washington into 255 rental homes and approximately 12,000 square feet of retail space.
The initiative provides construction and development teams with additional financing support for projects that might otherwise face challenges moving from planning to construction. The projects span adaptive reuse, commercial demolition, new residential construction, historic rehabilitation and transit-oriented development.
The Boston, Springfield and Worcester projects will reuse existing structures, while the Westford and Dedham developments involve replacement or redevelopment of obsolete commercial properties. This mix highlights the growing role of adaptive reuse and commercial-to-residential conversion in addressing housing demand while putting underused properties back into productive use.
For contractors and developers, the program also demonstrates how public incentives can help close financing gaps for complicated conversion projects. Massachusetts law allows qualified conversion projects to receive a credit of up to 10% of qualified development costs, subject to program requirements.
The latest awards bring the state's first two rounds of Commercial Conversion Tax Credit funding to 10 projects representing 1,195 new homes. For the construction industry, the program could continue to generate opportunities in rehabilitation, demolition, residential construction, building systems upgrades and related site work as Massachusetts seeks to expand its housing supply.
Source: Mass. Gov.
