Does it scale down? I can see two floors of an office building making a (very expensive) apartment but what about a cheap 1 bedroom? In "office mode", the office unit would be < 50% office, with most of the floor plan as bathrooms, laundry, and kitchen.

Not really.

I would argue that I live in a cheap 1 bedroom, it exactly this that you describe.

The bathrooms are a wash, both commercial and residential spaces require them. If anything the bathrooms in this arrangement are a bit smaller than traditional commercial bathrooms.

Same with the kitchen, commercial spaces have them, every place I've worked for the last 15 years has had one. So that's a wash. Also, our kitchen isn't huge, it's of similar size to those kitchens.

That leaves the laundry. For us it's a stacked unit in a small closet in the bathroom. They could easily be removed and then the closet could be used for bathroom cleaning supplies and no-one would ever suspect it wasn't just an office.

So the real comparison is: Residential: 1500 Sq ft loft, small glass office and loft bedroom, 2 full baths Commercial: 1500 Sq ft office, 1 large loft conference room, 1 small glass conference room/office, open Floorplan for 10-15 desks, 2 bathrooms with shower, full kitchen Both have door service, package receiving and security services provided on site, parking space