Manchester luxury apartments drive downtown growth

After three years in North Carolina, Lisa Lozeau-Trzepacz moved back to New Hampshire and found a new sense of comfort in downtown Manchester. At The Factory at Willow, a key-fob system that limits access by floor and shared spaces helped seal the deal. “I don’t look for another apartment because I don’t want to leave,” she says. “I feel settled and safe.”

Across town at 75 Canal, civil engineer Brian Pratt—who worked on the building’s design and permitting—says the downtown lifestyle is exactly what he wanted. “It’s a really good community,” he says, noting weekly resident events, outdoor spaces with games and seating, and views of the millyard and the Uncanoonuc Mountains. Living close to work fulfills the “live, work, play” ideal that’s drawn many young professionals into the city’s core.

From ghost town to momentum

Manchester’s downtown, once quiet during the pandemic, is rebounding as new apartments bring round-the-clock activity. “Coming out of COVID, downtown was kind of a ghost town,” says Tom Farrelly of Cushman & Wakefield. The surge of high-amenity rentals—often designed with work-from-home spaces and shared lounges—is changing that dynamic.

Recent standouts include The Factory at Willow (a 2021 conversion of the former Cohas Shoe Factory), 75 Canal (new construction opened in late 2024), Brady Sullivan’s residential conversion at 1000 Elm Street (late 2024), and The Lofts at Waumbec Mill (opened in March 2025). “Converting office to residential is a gamechanger,” Farrelly says. “Now you have restaurants serving breakfast, lunch, and dinner, and a stronger base to attract employers.”

Zoning overhaul targets mixed-use growth

The city’s proposed zoning ordinance update aims to streamline approvals, reduce variances, and expand mixed-use districts. Deputy Planning and Zoning Director Nicola Strong says the plan clarifies what housing types and aesthetics fit each neighborhood, often aligning rules with projects that previously needed variances. Duplexes, for instance, would be allowed in some areas where they were once restricted. Farrelly supports the changes: clearer “rules of the road” can speed up responsible development while preserving historic character. “It’s about maintaining the history while allowing the new to come in,” Strong says.

Who’s moving in—and why

There’s no strict definition of “luxury,” notes Eric Jackson of The Stabile Companies, but it typically means newer buildings with more amenities than standard apartments. The profile of downtown residents is shifting: from 2019 to 2025, the share of college-educated residents rose by more than 26%, and median household income jumped from $36,000 to $81,700, according to Placer Labs. Remote workers and retirees from major metro areas have added to demand, benefiting Manchester and communities along I-93, as well as Dover and Portsmouth.

Costs, rents, and the squeeze on affordability

Developers describe a volatile period during and after the pandemic. Jackson recalls lumber prices nearly doubling mid-project. The Factory at Willow’s founder, Liz Hitchcock, says the biggest cost drivers aren’t countertops or cabinets, but mechanical, electrical, plumbing, and especially HVAC. Land is pricey, too. Broker and consultant Amy Chhom estimates 75 Canal paid $5.625 million for 2.31 acres—about $2.43 million per acre, or roughly $22,500 per unit before construction.

Rents reflect those realities. At 75 Canal, studios (about 500 square feet) list around $1,888; one-bedrooms (700–800 square feet) run about $2,254 to $2,578; two-bedrooms and limited three-bedrooms (1,000–1,100 square feet) range roughly $3,000 to $3,400. At The Factory at Willow, studios lease around $1,740 for 472 square feet or $1,985 for 765 square feet. At The Residence at 1000 Elm, one-bedrooms start near $2,100. Chhom says higher rents are often necessary to reach stabilization and satisfy investors, particularly amid high interest rates. Farrelly argues that building truly affordable units typically requires subsidies or tax incentives, given today’s construction and financing costs.

Some residents trade up to newer “luxury” units, freeing older apartments and softening rents elsewhere. Chhom says she’s reduced rents in some buildings to retain reliable tenants, but overall, affordability remains tight—especially for families reliant on public transit. Many market-rate units exceed what housing vouchers can cover, pushing lower-income renters toward older stock.

Policy shifts and incremental relief

Advocates say adding any supply helps over time, but it isn’t sufficient for households well below the median income. Nick Taylor of Housing Action NH says supply growth “does relieve cost pressure,” but cautions that it’s not a quick fix and must be paired with affordable and transitional options. He notes the state recently reduced its affordable housing fund, even as new laws seek to expand housing pathways. A newly signed law allows detached accessory dwelling units, and another requires municipalities to permit multifamily housing in commercial zones. Farrelly believes clearer standards will make approvals more predictable.

Beyond Class A: demand shifts to the middle

Jackson sees demand for top-tier, Class A apartments leveling off, while interest stays strong for well-located, mid-market Class B properties. He prefers the term “attainable” over “affordable,” given costs. With high rates and materials pricing, single-family homes under $600,000 are rare, he says; building at scale—such as townhomes—can create more reasonably priced options. Employers are also stepping in. Dartmouth Health has developed multiple apartment projects near its facilities, and Service Credit Union is exploring mixed-use housing near its headquarters. Taylor says employer-assisted housing is an emerging model that can help workers in retail and service roles secure homes closer to their jobs.

For Manchester, the growing residential base downtown is already reshaping the street-level economy—supporting restaurants, retailers, and nightlife—while making the city more attractive to employers. With zoning reforms, adaptive reuse, and targeted partnerships, the city’s next chapter looks increasingly residential—and vibrantly urban.