A 17-story Westwood office building that Douglas Emmett bought earlier this year as a deed-in-lieu of foreclosure sale is slated to become apartments, the Santa Monica-based firm told investors in its earnings report this week.

The firm will convert the property at 10900 Wilshire Blvd., a roughly 247K SF office tower, into residences.

Douglas Emmett had previously announced plans to construct a 109-unit residential building on the property, but it had also planned to upgrade the office tower. The new project, with the added residential and conversion element, will create 320 new apartments.

The company anticipates that the first phase of converted apartments could be delivered in the next 18 months, though it’s unclear how many that might be. Floors will be converted as they are vacated, a process expected to span “a number of years,” according to Securities and Exchange Commission filings. Construction of the new residential building is expected to take three years.

Douglas Emmett acquired the tower from Tishman Speyer for $131M and estimates the total project costs to be between $200M and $250M, including the purchase price.

Developers have repeatedly said that office-to-residential conversions are challenging and require a building that will transition easily to apartments to keep costs low enough for the entire project to make financial sense.

In January, a RentCafé report found that nationwide, Los Angeles had the third-most units expected to be created by conversions at 4,388, an 80% increase from the prior year.