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What Microsoft has learned about housing, and why it’s urging the state to unlock commercial land
A bill to open up strip malls, big-box stores, and other commercial land for housing development across Washington state gets its first hearing today, with what might seem an unlikely supporter: Microsoft.
The tech giant is urging lawmakers to pass SB 6026, which would flip the default setting on commercial zoning: instead of requiring developers to seek permission for housing on commercial land, cities of more than 30,000 people would have to allow it in qualifying areas.
In other words, no more lengthy battles to turn half-empty strip malls into apartments.
It’s one piece of a broader strategy that Microsoft is laying out after more than five years and $750 million invested in affordable housing across the region, mostly in the form of a revolving loan fund. In a report released this week, the company makes the case that Washington’s housing crisis is solvable, but only if policymakers treat it as a systemic problem rather than a collection of isolated issues.
The report draws on lessons learned from Microsoft’s housing investments, which the company says are on track to create or preserve more than 16,000 affordable homes so far across King County and the broader region.
“We greatly underestimated the size, scope, and complexity of the problem,” acknowledged Jane Broom, senior director of Microsoft Philanthropies, in an interview with GeekWire this week. “We didn’t quite realize the interconnectedness of the housing sector, from shelter space to low-income housing to workforce housing to market-rate housing.”
She explained, “If you underperform in one of those areas, it greatly impacts the whole.”
Why does Microsoft care about housing? Broom said it comes down to economic opportunity and quality of life. Housing affordability has risen to become the top concern among Washington voters, she said, threatening the state’s ability to attract and retain workers.
Broom pointed to anecdotes about school teachers and essential workers commuting 90 minutes each way because they can’t afford to live closer, and young professionals leaving the region entirely because they can’t find affordable housing.
Microsoft added housing to its portfolio of community investments in 2019, alongside longstanding commitments to education, transportation, and arts and culture. The company’s report this week lays out a four-point plan based on its lessons learned:
- Unlock more land for housing, especially underused commercial property like strip malls and big-box stores, by making residential development the default in commercial zones.
- Fix the permitting process to make it faster and more predictable, removing unnecessary delays that add costs and drive developers out of the market.
- Lower construction costs through innovation in materials and methods, expanded tax incentives, and use of AI to streamline regulatory compliance.
- Build long-term public-private partnerships with clear accountability, leveraging private and philanthropic capital alongside public investment.
Another long-term opportunity mentioned in the report is AI. Broom said Microsoft is working with tech companies that serve municipal governments to integrate AI into permitting systems, helping to sort through complex building codes and regulatory requirements more quickly.
Some developers are already experimenting with the technology, she said, uploading building codes and municipal regulations to AI systems that can automatically flag whether a proposed design will comply, or how to optimize plans for housing affordability.
Microsoft isn’t the only local tech giant addressing the housing crisis. Amazon has committed more than $3.6 billion to affordable housing through its Housing Equity Fund, with more than $780 million directed toward the Seattle area since 2021.
The two companies have taken different approaches. Microsoft has focused primarily on the Eastside and middle-income housing, while Amazon has pursued project-by-project investments targeting lower-income households.
However, they are often on the same page on housing policy, Broom said.
“Thematically, we’ve always been aligned and supportive,” she said. “This is really hard and complicated, and this state is making it much more difficult than it really needs to be.”
Editor’s Note: Microsoft underwrites GeekWire’s independent coverage of civic issues. Learn more about underwritten and sponsored content on GeekWire.
