DOWNTOWN BROOKLYN Q2 2024 MARKET REPORT
Updated quarterly, this report provides insight on real estate market data, development progress and commercial leasing activity in Downtown Brooklyn.
DEVELOPMENT SNAPSHOT
COMPLETED PROJECTS (SINCE 2004 REZONING)
22,663
2.8 M
UNDER CONSTRUCTION + PIPELINE PROJECTS
2,368
Downtown Brooklyn Partnership’s (DBP) Development Matrix captures projects that have been completed since the 2004 Downtown Brooklyn rezoning, including development activity, project status and anticipated completion dates. For more detail information, please see the full Q2 2024 Development Matrix summary and map at: https://www.downtownbrooklyn.com/news/report/downtown-brooklyn-development-matrix/
8,981
714 K 103
Credit: Kate Milford
COMMERCIAL OFFICE
COMMERCIAL OFFICE VACANCY + RENTS
In the second quarter of 2024, office asking rents in Downtown Brooklyn have held relatively steady over the preceding quarter at $58.53 per sq. ft. Overall vacancies stand at 20.6%, a 90 bps decrease over the past quarter and 140 bps decrease year-over-year. The notable decrease in overall vacancy was due to 175 Pearl Street being taken off the market. The 230,000 sq. ft. Class B office building is slated for residential conversion.
The overall office vacancy rate in Lower Manhattan has remained flat at 24.6% over the past quarter; which is four percentage points higher than Downtown Brooklyn. In addition, Downtown Brooklyn’s average office rent reached $2.90 more per sq. ft. than in Lower Manhattan, widening the gap that was established after the pandemic. This shift is attributed to the influx of new Class A office inventory in Downtown Brooklyn and a large amount of direct and sublet office space in Lower Manhattan, signaling a reduced comparative advantage for budget-conscious office users in Downtown Brooklyn. For instance, Lower Manhattan has 21 million sq. ft. of direct and sublet space available for lease, compared to 2.89 million sq. ft. available in Downtown Brooklyn (the entire Downtown Brooklyn market has an office inventory of 14 million sq. ft.).
Overall Office Vacancy by Submarket
Overall Average Asking Rent PSF by Submarket
In Manhattan’s Midtown and Midtown South submarkets, rents remain relatively stable at $78 per sq. ft. Vacancy rates remain above Downtown Brooklyn’s at 22.9% and 25.3%, respectively.
Overall Average Office Rents and Vacancy, Downtown Brooklyn and Lower Manhattan
Source: Cushman and Wakefield
RETAIL
NEW RETAIL LEASES ACROSS DOWNTOWN BROOKLYN
Downtown Brooklyn saw 12 retail openings and several new leasing announcements during the second quarter of 2024. Highlights include:
• Sephora opened its third Downtown Brooklyn store at City Point, along Albee Square West. Their other locations in the neighborhood are at Atlantic Terminal and 210 Joralemon Street.
• Since opening its 9,000 sq. ft. restaurant in April at the Flatbush Avenue entrance at City Point, Fogo de Chão has seen robust business. Alamo Drafthouse has completed major upgrade, bringing new recliner seats to all theatres, five new auditoriums, additional restrooms and upgrades to projection capabilities.
• Brooklyn Made, a long-term, pop-up store that is operated by the Brooklyn Chamber of Commerce and sells locally made goods, opened in the Prince Street passage of City Point.
• Wine and spirits retailer Wright & Goebel relocated from Livingston Street to 1 City Point at the corner of Willoughby Street and Flatbush Avenue in May. GoodVets pet clinic is slated to open next door in the coming months.
• Golfzon Social, an 18,000-sq. ft. indoor golf simulation venue and sports bar, opened its first NYC location at 11 Hoyt Street in April.
• Life Time Fitness opened a 37,000 sq. ft. location at Brooklyn Crossing (18 Sixth Avenue), with plans
to open a second Downtown Brooklyn location in the Brooklyn Tower. These join Life Time’s Dumbo location, which opened in October 2022.
• Several new food and beverage options opened in the neighborhood this spring and summer, including Playa Bowls at 102 Willoughby Street, Chihiro Tea at 94 Willoughby Street, Nice Day Chinese at 374 Pearl Street, and Chapel Deli & Market at 22 Chapel Street.
• Naked Perfection Spa, which provides facials, laser hair removal, and other esthetic treatments, opened at 292 Livingston Street.
• Two fitness studios are coming soon to Downtown Brooklyn: Hot 8 Yoga at 57 Court Street, and Bodyrok Studios at 397 Bridge Street.
• Two retailers on Fulton Mall: hat store Lids will open at 517 Fulton, as well as Guitar Center at 540 Fulton. The music retailer is moving from its Atlantic Terminal location to 19,289 sq. ft. of ground floor space at 540 Fulton Street in October 2024.
• Several food and beverage options have announced openings later this year: Yafa Coffee at 505 State Street in the Alloy Block, Starbucks at 500 Fulton Street, Jersey Mike’s Subs at 117 Livingston Street and Blank Street Coffee and Chop’t, both at 1 Boerum Place.
• Dental office Tend Dental will open late summer at The Guild at 308 Livingston. Tend joins PUPS Pet Club, which opened next door in March 2024.
Golfzon Social Opens at 11 Hoyt Street
Credit: Golfzon
Sephora Grand Opening at City Point
Credit: City Point BKLN
GRAND OPENINGS
ABOLITIONIST PLACE DEBUTS IN DOWNTOWN BROOKLYN
Abolitionist Place, the 1.15-acre public open space fronting Willoughby Street, Albee Square West and Duffield Street opened in May 2024. The park includes a playground, dog run, water feature and ample seating areas. Additionally, there will be a site-specific public art installation by Kenseth Armstead commemorating the Abolitionist Movement, to be installed at a later date. The park was designed by Hargreaves Jones, developed by NYCEDC and will be maintained and programmed by DBP.
The park is located in the heart of the neighborhood and borders City Point, two hotels (Aloft and Sheraton), JP Morgan Chase’s offices at 4 Metrotech Center, new Class A office space at One Willoughby Square and 141 Willoughby, as well as several residential buildings.
In June 2024, based on a new MRI OnLocation foot traffic sensor, an average of 4,976 people visited the park daily—4,450 on weekends and 5,239 on weekdays. There are notable spikes in foot traffic on weekdays during lunchtime and in the early evenings.
20th ANNIVERSARY OF DOWNTOWN BROOKLYN’S REZONING
June marked 20 years since the 2004 rezoning of Downtown Brooklyn. Targeted public policy and investments helped turn a previously underinvested neighborhood into the dynamic mixed-use area it is today. The rezoning spurred the development of over 32 million sq. ft. with more than $34 billion in new investments. Over 22,000 new housing units were created, along with 114,000 direct and indirect jobs, contributing $1.2 billion in fiscal impacts to New York City.
In celebration of this milestone, the DBP produced a retrospective of the impact of the rezoning. The interactive StoryMap uses Google Street View and historic images to provide a fascinating look at two decades of progress that took Downtown Brooklyn from a commercial and civic center to a vibrant mixed-use neighborhood.
Abolitionist Place
Credit: Max Touhey
Credit: City Point BKLN
RESIDENTIAL RENTS
The average residential rent in Downtown Brooklyn was $4,757 in June 2024, up 2.6% year-over-year. This increase in rents was driven by studios and onebedrooms, which both saw a 4% hike from last year.
Surrounding Downtown Brooklyn, several neighborhoods saw year-over-year increases in rent -- Cobble Hill (21.3%), Brooklyn Heights (6.3%), and Fort Greene (1.95%). These notable increases are attributable to limited supply and high demand. Dumbo (0.21%) stayed constant and Boerum Hill (-1.27%) saw slightly lower rents.
Source: MNS
Average Residential Rents in Downtown Brooklyn by Unit Size, 2020-2024
Average Residential Rents in Downtown Brooklyn
RESIDENTIAL SALES
The median sales price in Downtown Brooklyn for new condominiums was $2,137,234, an increase of 9.9% year-over-year. The median price per square foot, $1,660, decreased by a slight 1.1% year-over-year. The higher median price relative to the price per square foot can be attributed to the fact that a majority of the 39 new condos sold this quarter were larger units: 56% were two-bedroom units, while 36% were three or morebedroom units. The units sold in Downtown Brooklyn accounted for 10% of sponsor sales volume in Brooklyn, the third most active submarket in the borough.
Across Brooklyn, the median price per square foot increased by 15.3% year-over-year, from $1,253 to $1,445. Brooklyn’s overall median sales increased 26.5% over the past year from $997,885 to $1,262,547.
Median Residential Sale Price Per Square Foot - Downtown Brooklyn New Development
Median Residential Sales Price Per Sq. Ft. - Downtown Brooklyn New Development
Median Price Per Square Foot- Downtown Brooklyn
PEDESTRIAN + VISITATION
According to Placer.ai, Downtown Brooklyn saw 4.8 million total visits in June 2024, which is a slight 1.24% decrease from the previous year. Though neighborhood visitors and employees have not yet recovered pre-pandemic daily visit levels—83% and 81%, respectively—the influx of new residential buildings contributed to 150% more visits by residents compared to June 2019.
On a more granular level, Fulton Mall saw 5.1% more visits year-over-year in June 2024, Court Street saw 4.5% fewer, and MetroTech stayed relatively equal. In terms of unique visitors, Fulton Mall increased by 9.4%
year-over-year, MetroTech increased by 6.2%, and Court Street decreased by 2.3%. Unique visitors refer to the number of individuals in a given month who entered the neighborhood. Visits refer to the total number of visits that month, meaning one individual can account for multiple visits.
Based on MRI OnLocation sensors that count foot traffic at specific intersections, some Downtown Brooklyn locations experienced notable year-overyear increases in average daily foot traffic: 1 Metrotech (11.5%), Schermerhorn Street between Smith and Hoyt Streets (11.2%) and the corner of Flatbush and Lafayette Avenues (2.7%).
Source: Placer.ai
SUBWAY RIDERSHIP TRANSPORTATION
In May 2024, the average daily subway ridership across all Downtown Brooklyn stations saw a 6.3% increase year-over-year with 6,500 more daily subway riders starting in Downtown Brooklyn each day. Subway ridership has recovered 70% of 2019 levels. Ridership increased 6.6% on weekdays year-over-year with about 7,500 more daily subway riders starting in Downtown Brooklyn each day. Weekends experienced a 1% increase in ridership year-over-year.
• All stations experienced year-over-year increases in ridership in May 2024, ranging between 4.1% and 21.5%.
• Hoyt St (2/3) station experienced the largest percentage bump in ridership, with a 21.5% increase, equating to about 1,000 more daily riders as compared to last year. This increase may be due to the new accessible subway entrance on Fulton Street opened in late September 2023. Macy’s paid for the construction of the new entrance.
• Hoyt St (2/3) and Hoyt-Schermerhorn (A, C, G) stations have experienced the greatest recovery post-pandemic, both reaching about 82% of May
Downtown Brooklyn Average Daily Subway Ridership by Station, May 2019-2024
CITI BIKE RIDERSHIP
Over 147,000 Citi Bike riders utilized one of Downtown Brooklyn’s 19 Citi Bike stations in June 2024. Ridership was up 42% year-overyear, with 43,691 more total riders. Compared to June 2019, there were 99% more rides, which can also be attributed to new bike lanes and five additional docking stations added within the past five years.
DeKalb Av (B,Q,R)
St (2,3) Hoyt-Scherm (A,C,G)
Nevins St (2,3,4,5)
Downtown Brooklyn Average Daily Subway Ridership, May 2019-2024
PROPERTY SALES
• 9 DeKalb Avenue: Silverstein Properties has taken over the Brooklyn Tower’s rental, retail, and unsold condo units from JDS Development in a $672 million deal. The 93-story, 555,734 sq. ft. building has 150 condos, 400 rentals (120 of which are affordable) and incorporates the landmarked Dime Savings Bank.
• 81 Prospect Street: RFR and Kushner have sold an interest in the 95,000 sq. ft. office property for $33.8 million to developer Jack Guttman. The exact size of the stake is unclear. The new owner, who owns Green Desk coworking, is expected to convert the former WeWork space into a Green Desk.
DEVELOPMENT OVERVIEW
As of Q2 2024, Downtown Brooklyn development includes:
• 33 Nevins Street: This vacant lot is slated to become part of a larger development site by Monarch Realty, which has also acquired the adjacent properties 340 and 342 Livingston Street.
• 540 Fulton Street: In July, a joint venture between KKR and Dalan Management bought The Paxton at 540 Fulton Street for $240 million from Jenel Real Estate. The 43-story, 300,000 sq. ft. tower, which opened in 2022, includes 327 rental units, including 98 affordable units. Jenel will still own the 145,000 sq. ft. of commercial office and retail at the base. KKR also owns 80 DeKalb Avenue and 230 Gold Street in Downtown Brooklyn.
• 147 projects completed since the 2004 rezoning, including 22,663 residential units (of which 4,659 are affordable), 2.8 million sq. ft. of office space and 2.5 million sq. ft. of retail.
• 19 projects under construction including 16 residential buildings with 5,468 residential units (1,332 of which are affordable) and 122,000 sq. ft. of retail.
• Another 14 projects planned, including at least 3,500 residential units (of which 681 will be affordable).
22,663
RECENTLY COMPLETED
5,468
• 505 State Street, The Alloy Block: The tower received its first certificate of occupancy in late March and residents began to move in early April. Alloy Development’s 44-story building includes 440 rental units, including 45 units of affordable housing, 14,000 sq. ft. of ground floor retail spaces along Flatbush and 500 bicycle parking spaces. The two schools, a new elementary school, PS456, and a new home for the Khalil Gibran International Academy, will begin classes in early September. Phase two at 80 Flatbush Avenue will include a second, larger tower and will include residential, office space and a cultural center. Phase 2 is anticipated to commence towards the end of this year.
3,500
• 142 South Portland Avenue, Hanson Place Community Plaza: Construction is complete on Hanson Place Community Plaza, a 13-story affordable housing complex at 142 South Portland Avenue. Developed by Hanson Place Seventh-day Adventist church (Hanson Place SDA) with support from NYC Department of Housing Preservation and Development (HPD) and NYC Housing Development Corporation (HDC), the project provides 104 apartments for low- to moderate-income households. The building has 22,000 sq. ft. of community space, including an 8,000 sq. ft. medical center, office space for Hanson Place SDA and a 250-person multi-purpose room.
ONGOING CONSTRUCTION
RESIDENTIAL RENTS
• 99 Fleet Place: The Jay Group’s 21-story, mixeduse tower continues façade work and is very close to completion. The tower will have 294 rental units (including 74 affordable units), 4,500 sq. ft. of retail space and a 44-car parking garage. Tenants will begin moving into the building in Q3 2024.
• 9 Chapel Street: Tankhouse Development has wrapped up construction and is awaiting TCO on its 13-story, 27-condo unit building. The developer expects closings to start in the early fall.
• 15 Hanover Place: Completion of Lonicera Partners’ 34-story tower at the corner of Hanover and Livingston is expected in fall 2024. The project will include 314 rental units, 95 of which are affordable, and 9,000 sq. ft. of retail space. Leasing is expected to commence soon.
• 55 Willoughby Street: Lonicera Partners’ 38-story, 295-rental unit residential tower is quickly ascending, and facade work has begun on lower levels. The building will include 89 affordable units and 3,500 sq. ft. of retail space. Nearly 107,000 sq. ft. of air rights were transferred from 57 Willoughby Street.
• 240 Willoughby Street: Adjacent to The Brooklyn Hospital Center campus, Rabsky Group’s 30-story, 300-unit building at 240 Willoughby Street continues interior buildout. The tower, fronting Fort Greene Park, will include 147 affordable units. Rabsky is also renovating the existing 21-story, 189-rentalunit tower at the site. The new tower is slated for completion in early 2025.
• 625 Fulton Street: Facade work takes shape at Rabsky Group’s 35-story residential building. The building will have 1,044 rental units, with 313 affordable units, and a 250-car parking garage. Additionally, there will be 46,000 sq. ft. of commercial retail space, including a 26,000 sq. ft. grocery store. The building is anticipated to be completed in early 2025.
• 111 Willoughby Street: The Triangle Equities/The Michaels Organization’s tower has topped out and the façade is being installed. The 40-story tower will bring 227 rental units, 69 of which will be affordable. There will also be a 20,000 sq. ft. ministry center for the neighboring Oratory Church of St. Boniface. The site includes 16,000 sq. ft. of air rights transferred
from 115 Willoughby Street. The development is slated for completion in Spring 2025.
• 98 DeKalb Avenue: Rockrose’s 49-story residential tower has topped out. Located along Ashland Place across from The Brooklyn Hospital Center, the tower will yield 569 rental units, 171 of which will be affordable, and 3,775 sq. ft. of retail space. Completion is expected in 2026.
• The Brook at 565 Fulton Street: Witkoff and Apollo’s 51-story residential tower, The Brook at 565 Fulton Street, topped out this spring and has continued façade and interior work. The superstructure located at the corner of Fulton and Flatbush will have 591 rental units, including 178 affordable units. The project also includes 25,000 sq. ft. of retail space at the base of the tower and a jewel-box site next to Albee Square. The tower anticipates occupancy in late 2025.
• 89 DeKalb Avenue: RXR’s 30-story, 324-rental unit mixed-use development is topping out in August. The fully-electric project will include 98 affordable units and 55,000 sq. ft. of academic and office space for Long Island University at the base. A late 2026 completion is expected.
• 71 Prince Street/202 Tillary Street: Madd Equities’ 31-story residential complex will yield 465 rental units, including 118 affordable units, 4,000 sq. ft. of retail space, and 40- 50 enclosed parking spaces. 71 Prince Street is expected to be completed by 2026.
• 150 Lawrence Street: The superstructure has quickly risen at Twin Group Associates’ 25-story, 101-condo unit residential building. The tower will have 8,200 sq. ft. of retail space and expects a 2026 completion.
• 570 Fulton Street: Developing NY State’s project is quickly ascending. The 23-story, residential tower includes 163-rental units (including 33 units of affordable housing). The building will also have 5,200 sq. ft. of commercial space. The vacant site was sold for $24 million by Davis Companies to Developing NY State in early 2023.
• 19 Rockwell Place: Brookstone Developers’ 27-story building with 174 rental units, including 7 affordable units is well underway and rising rapidly.
RECENTLY STARTED CONSTRUCTION
• NYU: NYU has commenced structural demolition of two buildings in their MetroTech campus. The Civil Engineering Building (located at 80 Johnson Street), has been demolished. The Jacobs Administrative Building (located at 333 Jay Street) is scheduled for demolition in the coming months. No plans for the sites have been filed.
• 88 Schermerhorn Street: Excavation and foundation work is underway at Jankos Group’s 20-story building with 58 rental units, including 14 affordable units.
NEWLY ANNOUNCED DEVELOPMENTS
• 170 Remsen: Rockrose has begun development of 170 Remsen Street. This location served as St. Francis College’s home for six decades until its recent relocation to The Wheeler building in Downtown Brooklyn. The site will include 3 newly constructed buildings and the incorporation of the landmarked Brooklyn Union Gas Company Building, operating as one building. Rockrose recently received enthusiastic approval from the Landmarks Preservation Commission for alterations to the landmarked property. Plans include 746 rental units (including 188 affordable units), along with groundfloor retail.
• 236 Gold Street: Developer Joel Schwartz has filed for a rezoning of the long-time vacant site to increase the project scope from the previously planned 26 condo-unit building to a 117-unit rental project with ground floor retail. The building would have 30 affordable units. The developer is also seeking to waive a parking requirement for the lot.
• 362-370 Livingston Street: Developing NY State continues demolition work on the existing 8-story building to make way for two proposed 22-story buildings, totaling 249 units according to DOB records. The site will include 7,162 sq. ft. of retail space.
• 205 Montague Street: Landau Development recently filed plans for a 47-story, mixed-used tower. The 530,000 sq. ft. tower will include 286,000 sq. ft of residential space (for 136 condos), 244,000 sq. ft. of commercial space and a 100-car parking garage. The project lot includes the adjacent 14-story office building at 195 Montague Street and 6-story office building along Cadman Plaza.
• 175 Pearl Street: Watermark Capital purchased the 8-story, 230,000 sq. ft., Class B office building for $66.5 million and plans to convert the tower into a 14-story residential building, taking advantage of the new 467-M state tax incentive. The project is currently slated for 240 rental units.
• 188 Duffield Street: Watermark Capital has filed plans to construct a 30-story, 115-unit apartment building. The 102,224 sq. ft. tower will also include 3,658 sq. ft. of community space. The site is currently home to the landmarked Duffield Street houses.
IN THE NEWS
Downtown Brooklyn marks 20 years since historic rezoning. Interactive map highlights major changes
Unlocking NYC’s economic potential with ‘City of Yes’ zoning reform
Downtown Brooklyn marks 20 years since rezoning
Silverstein Gets Control of Brooklyn Tower From Michael Stern in $672M Deal
A Brand New Park Just Opened in Downtown Brooklyn
‘Asphalt Art’ brings beautification, pedestrian safety to Downtown Brooklyn
Alamo Drafthouse Completes Major Upgrade, Expansion Of Its Top Grossing Downtown Brooklyn Cinema
‘It’s an opportunity to take a breath that I didn’t have before’: Voices from Abolitionist Place
A look inside Golfzon Social – indoor golfing, golfing arcade games for kids, and a sports bar in Downtown Brooklyn
