Landmark California Bill to Turn Empty Office Towers Into Housing Heads to the Governor’s Desk With Bipartisan Backing

SACRAMENTO, CA – A major push to breathe new life into California’s hollowed-out downtowns took a big step forward today. Assemblymember Matt Haney’s (D-San Francisco) bill to speed up office-to-housing conversions passed the Senate with a 30-9 vote and now heads to the Governor’s desk for a signature.

With office buildings sitting empty in cities like Los Angeles and San Francisco—where vacancy rates are the highest they’ve been in three decades—AB 507 aims to cut red tape and get more people living and spending downtown.

“This is how we bring our downtowns back,” said Haney, who chairs the Committee on Downtown Recovery. “The demand for urban housing is sky-high, but the path to converting these empty offices is full of roadblocks. AB 507 clears that path and makes it easier to build homes where we need them most.”

The bill allows local governments to approve office-to-housing conversions by right in city centers, streamlining what is often a long and expensive approval process. Supporters say the measure will unlock thousands of new homes while restoring vibrancy to downtown streets that have gone quiet since the pandemic shifted work patterns.

Across California, commercial real estate is taking a hit. Offices are losing tenants, property values are falling, and cities are bracing for a financial crunch. AB 507 offers a solution: turn unused office space into desperately needed housing.

The bill now is sitting on the Governor’s desk awaiting a signature.