"Made in Brooklyn" Manufacturing, Retail Is Strategy to Revive Industry City

New management at Sunset Park’s Industry City industrial complex on the waterfront plans to refashion it into a hub for new-Brooklyn manufacturing (tech, artisanal, food) that the public can visit. The investors hope this strategy will raise the value of the complex, which was appraised at only $136,000,000 last year, reported The Wall Street Journal.

The strategy is modeled after the highly successful Chelsea Market in Manhattan, developed by Jamestown LP, also one of the new owners of Industry City. The former National Biscuit Co. factory houses retail space on the ground floor where tenants manufacture and sell to the public. The new owners plan to do the same here. The upper floors of the complex house Google and Scripps Networks offices, also the kind of new economy companies Industry City hopes to attract.

Demand at the similarly revamped industrial waterfront space the Brooklyn Navy Yard exceeds supply, said Industry City chief executive officer Andrew Kimball, formerly chief executive of the Brooklyn Navy Yard Development Corp. Industry City management plans to upgrade the electrical system, damaged in Hurricane Sandy, and the industrial spaces, as well as seek other improvements in the area, such as ferry service and bike lanes, said the story.

Recently added tenants include maker of three-dimensional printers MakerBot; Red Rabbit, maker of “healthy school lunches”; and artisanal ice cream manufacturer Blue Marble. Space ranges from $4 a square foot for storage to $12 a square foot for manufacturing. At its peak, about 25,000 people worked there, said the Journal, but efforts to revive the facility stalled during the financial crisis.

“Occupancy slid to around 60 percent, from 87.2 percent in 2007, and the property’s loan went into default in 2011. Superstorm Sandy delivered another blow by flooding parts of the property last year,” said the paper. The new group of investors, which includes Jamestown LP, Belvedere Capital Real Estate Partners and Angelo Gordon & Co., took a half stake and promised to invest $35,000,000 and take on part of the $300,000,000 debt. “For the new investors, the deal pays off only if they can significantly raise the property’s value,” said the story.

“What is interesting is a sort of redefining of what manufacturing is,” said Kimball. “You’ve got a tremendously well-educated creative class that wants to make cool things again near where they live.”

Industry City Investors Hope “Made in Brooklyn” Lures Tenants [WSJ]