The old Independent Order of Odd Fellows building

The old Independent Order of Odd Fellows building on 73 Hanover St. in Manchester (in foreground) will house 43 apartments.

MUCH LIKE the well-known Citizens Bank building it owns in Manchester, Red Oak Apartment Homes hopes to transform another commercial building nearby into apartments.

The company purchased 73 Hanover St. for $1.5 million at the end of last year with the intention to convert the upper four floors into 43 market-rate apartments, according to owner Ron Dupont. The 1871 building once housed the Independent Order of Odd Fellows.

“Hanover Street is one of the most vibrant streets in Manchester and potentially the state with the Palace Theatre playing a role there,” Dupont said.

Red Oak also owns the Opera Block across the street and a parking garage at the Citizens building that tenants of the new apartments could use.

The demand for office space is down, while the need for housing remains high, according to the company.

Another company, Gamache Properties, is converting commercial space on Chestnut and Lowell streets into apartments, 12 and nine units, respectively. Brady Sullivan is adding 34 more units to the Jefferson Mill on North Commercial Street.

A little further outside downtown, the former Currier Art Center and Victorian home on the property will be converted to 29 apartments.

Elm Grove Companies completed similar conversions of Pearson’s Place next to City Hall into 30 one-bedroom apartments and the former Farnum Center building at Union and Hanover streets into 32 micro-apartments

The Hanover Street building — across from the Palace Theatre — will continue to have four storefront units on the ground level. Floors two through five will be a mix of studio and one-bedroom apartments, according to the plan.

The apartments will be scaled back from most luxury apartments being built, including a new Red Oak building under construction on Elm Street across the street from Market Basket, he said.

“We are going to try to make them as low-cost as possible,” Dupont said. “I don’t think we are going to put in stainless steel appliances. I think we are going to put in white appliances. I think we are going to put in common area washers and dryers.”

The units will likely draw college students, teachers and people interested in the arts given its proximity to the Palace and other arts venues downtown.

The proposed apartments meet the goals of the Central Business District, which promotes a mix of uses, according to an application for the project.

Mike Skelton, president and CEO of the Greater Manchester Chamber of Commerce, said there is a critical need for more housing options.

“Property owners and developers are looking for options to convert and create more mixed-use buildings like this. It is a positive trend, and it can be part of the solution,” he said.

Units geared toward young professionals or couples will add foot traffic downtown, “at a time when I think that is really important when our restaurants, entertainment businesses and retail businesses are trying to bounce back,” he said.

The new apartments will benefit all of Hanover Street and downtown in general, said Peter Ramsey, president and CEO of the Palace Theatres. The apartments will make the street more liveable and friendly, he said.

“I think it will be very successful,” he said. “People around the country want to live where there are arts and theaters. You see it work in Boston, and I think it is a good thing for Manchester.”

The units could help the theater boost its membership. Some of the Palace’s 40 employees might try to move in, Ramsey said.

The Hanover Street project heads before the Zoning Board of Adjustment July 8 for a variance to reduce the lot size required. The project will also require planning board approval.

The density is determined by unit count, not bedrooms, the application reads.

“(Thirteen) units with three bedrooms each would create more burdens on community services than the current proposal,” the application reads. “The ordinance also determines density which penalizes owners of pre-existing tall buildings on small lots. The vitality and growth of downtown is dependent on market rate housing.”

The cost of the project, which is still in the early planning stages, has yet to be determined. The timeline for completion depends on city approvals.