Although off to a slow start the New York City commercial real estate market is starting to pick up and Brooklyn seems to be catching up to Manhattan.
Commercial Café just released their 2017 New York City Quarter 1 Office Report analyzing the New York City office investment market. The report found that investment in NYC office real estate started off slowly in the first months of 2017, with a total of ten major transactions—eight in Manhattan and two in Brooklyn. While these ten office real estate transactions totaled $2.07 billion during the first three months of 2017, total sales volume was 63 percent lower than this time last year, with an average price per square foot down 23 percent from Q1 2016 at $964 to $741 in 2017. The largest sale in the first quarter of 2017 was at 60 Wall Street in lower Manhattan which closed for $1.04 billion.
Although Midtown Manhattan remains the most popular area for commercial real estate—breaking records as they did in 2016 for price-per-square-foot helping New York City maintain its title as one of the world’s most expensive office markets for both rentals and sales, with several projects scheduled for completion in the coming months, Brooklyn is quickly attracting big deals in the commercial category. Meadow Partners paid $54 million for 57 Willoughby Street in Downtown Brooklyn, a property previously owned by Helen Keller Services for the Blind. The second highest Brooklyn property transaction was at 185 Marcy Avenue in Williamsburg. Acuity Capital Partners purchased the six-story, 70,000-square-foot building for $30 million. The only new office project development to be completed in New York City in Q1 was also in Brooklyn, at 2361 Nostrand Avenue in Midwood.
Upcoming Q2 Brooklyn deals include the redevelopment of historic 10 Jay Street scheduled to debnut May 31. Also Brooklyn Navy Yard, Building 77 at 63 Flushing Avenue, Pioneer Building at 41 Flatbush Avenue, and Turbine at 29 Ryerson Street, all scheduled to be completed April 30, 2017. It will be interesting to see what business and restaurants these new properties attract to the borough.