This paper explores the potential of adaptive reuse as a sustainable and economically viable solution to the growing shortage of affordable housing in urban areas. Focusing on the conversion of underutilized commercial properties into affordable housing, the study highlights the financial, legal, social, and environmental aspects of adaptive reuse projects. The paper discusses various financial strategies, including cost estimation, capital investment, and financing mechanisms such as tax incentives and public-private partnerships, which enhance the feasibility of these projects. It further examines the legal and regulatory challenges, including zoning laws and building code compliance, and how they can be navigated to ensure successful conversion. Socially, adaptive reuse offers significant benefits by promoting mixed-income neighborhoods and reducing gentrification risks, while environmentally, it contributes to sustainability by minimizing waste and reducing the carbon footprint. The paper concludes with future policy and practice recommendations, including expanded financial incentives, streamlined zoning regulations, and further research into sustainable financing models. Ultimately, adaptive reuse is positioned as a critical strategy in urban regeneration, offering a pathway to both affordable housing and long-term community development.