As an investor, landlord and broker for the past 15 years, I have had the great opportunity to watch the miraculous “coming out” of a borough that spawned the term “urban flight” in the 1960’s. Recognized as the largest brand coming out of NYC, Brooklyn has quickly become a world-class destination in its own right. Why Brooklyn? The answer comes down to fundamentals.
The most populous borough with 2.8 million residents, Brooklyn itself would stand alone as the 4th largest city in the U.S. It is also the 4th largest economic center in the country. Back when Brooklyn was on the brink of becoming what it is today, you used to have to trick cabbies to take that trip. Nowadays, tourists and residents alike continue to shuttle between destinations such as the new Barclay’s Center and arguably one of the best parks in New York City, Prospect Park. Brooklyn is the home of the most talked-about restaurants downtown, as well as several noted dance, music and theater venues, all of which have come to the area because they too want to experience what the borough has to offer.
Hotels, office, retail, tech and media spaces are also on the rise in Brooklyn. In development-related news, real estate investor Jared Kushner is building a Silicon Valley-style “urban campus” and inventing a new neighborhood, DumboHeights, all at once. Atlantic Yards, now firmly in place, is in the process of building the first of its 16 slated residential towers. It is one of many mixed-use commercial and residential development assets rising in Brooklyn, joining the ranks of other nearby projects including DominoSugar, Greenpoint Landing and Brooklyn Bridge Park, all bringing millions of square feet of multi-disciplinary buildings to the booming borough.
In the housing market, a widespread inventory shortage coupled with the overwhelming desire to stay urban has created a crisis in supply across all sectors of the market in NYC. The effect has been increased prices for both rentals and sales and an upshot in land prices, forcing developers to build very high-end condominiums in order to satisfy their returns. Additionally, the pipeline of permitted projects is just now returning to pre-Lehman Brothers levels, as demand is expected to increase at an unprecedented rate into the foreseeable future. With a new Mayor at the helm of New York City’s housing development initiatives, the fight for affordable housing also continues. However, despite its overwhelming increase in popularity, Brooklyn is still at one-half to two-thirds the price of Manhattan housing across all sectors.
Brooklyn is cool. Brooklyn is a feeling. Brooklyn is now.