Commercial Real Estate

The new residential projects in Downtown Brooklyn may be chugging along despite broader setbacks in the local and national economies, but the state of the area’s commercial real estate is having a tougher time of it. According to an article in Crain’s, there were only three new office leases last year in excess of 30,000 square feet: One at 470 Vanderbilt, one at MetroTech and one at 1 Pierrepont Plaza. The market is a mixed picture, with a vacancy rate that is lower than almost any major office market in America, but it’s a very slow-moving market,” said Chris Havens, chief executive of Brooklyn-based brokerage Creative Real Estate Group. Crain’s argues that Downtown Brooklyn has suffered from a double-whammy: A recession that has seen companies of all stripes cutting back on their need for space coupled with declining office rents in prime areas of Manhattan. It’s hard to see who would have an appetite for large chunks of office space in downtown Brooklyn, says Marisa Manley, president of Commercial Tenant Real Estate Representation. The slow pace of new leases may not be the real problem, though; instead, the big question is whether the large existing tenants, many of them back-office operations of large Manhattan-based firms, will renew.
Downtown Brooklyn Losing Its Big Edge [Crain's]