Brooklyn commercial real estate

Brooklyn, neighborhood by neighborhood

Sal grew up in Brooklyn and has built here, so we look at the borough the way a local owner does: street by street, with an eye on what a building can become as well as what it is today. Each submarket below has its own zoning history, transit, tenant base and buyer pool.

Gowanus

Gowanus spent most of the last century as an industrial district along a polluted canal. The canal is an EPA Superfund site now being cleaned up, and the 2021 Gowanus Neighborhood Plan rezoned much of the surrounding area for residential and mixed-use buildings with Mandatory Inclusionary Housing, while keeping space for industrial and arts uses in parts of the district.

That combination makes Gowanus one of the most interesting places in the city to buy land, and one of the most technical. Environmental history, flood zone requirements, waterfront rules near the canal, sewer and infrastructure commitments and affordable housing obligations all affect what a site can support and what it costs to build. We have hands-on construction and development experience in Gowanus, which lets us talk about those issues in practical terms rather than theory.

Williamsburg

Williamsburg went from industrial waterfront to one of the most recognized neighborhoods in the world in about twenty years. The 2005 Greenpoint-Williamsburg rezoning opened the waterfront to residential towers, and the redevelopment of the old Domino Sugar refinery site added housing, office and a waterfront park. Bedford Avenue, the streets around the L train and the blocks near the waterfront carry national brands, independent shops, hotels and a large restaurant scene.

Retail tenants pay for that foot traffic, and the best corners rarely come available. Office options include converted loft buildings and newer boutique office near the waterfront. For investors, small mixed-use buildings on side streets remain the core of the market, and their value depends heavily on the residential rent roll and its regulatory status.

Greenpoint

Greenpoint sits just north of Williamsburg, bordered by Newtown Creek and the East River. Manhattan Avenue is its main commercial street, with Franklin Street carrying newer restaurants and shops. The waterfront has seen large residential development, while blocks closer to Newtown Creek still hold working industrial and manufacturing businesses, partly inside the North Brooklyn Industrial Business Zone.

Greenpoint appeals to retailers and restaurants that want a strong local customer base, and to small creative and light-industrial users looking for character and lower costs than Williamsburg. Transit is mainly the G train and the East River ferry, which matters for office tenants recruiting from outside the neighborhood.

DUMBO

DUMBO, between the Manhattan and Brooklyn Bridges, is Brooklyn’s best-known creative office district. Large converted warehouse and factory buildings house technology, design, media and e-commerce companies, and much of the neighborhood is a designated historic district. Brooklyn Bridge Park along the waterfront draws residents and visitors, supporting restaurants and retail.

Office space here is loft style: high ceilings, big windows, heavy timber or concrete floors. Inventory is concentrated among a relatively small group of owners, so availability can be limited and tenants benefit from starting early. The F train at York Street and the A and C at High Street connect DUMBO to Manhattan quickly.

Downtown Brooklyn

Downtown Brooklyn is the borough’s civic and transit center, with Borough Hall, the courts, MetroTech, several universities and one of the densest clusters of subway lines in the city, plus the Long Island Rail Road at Atlantic Terminal. The 2004 rezoning brought a wave of residential and office towers, and Fulton Mall remains one of the busiest shopping streets in New York.

Tenants here include government agencies, schools, back-office operations, nonprofits, health care and a growing number of private companies drawn by transit and space that costs less than comparable Manhattan buildings. Retail is high-volume and value oriented along Fulton Street, with more varied concepts in newer mixed-use projects.

Red Hook

Red Hook is a waterfront peninsula with no subway station, which has kept it more industrial than its neighbors. Warehouses, the Brooklyn Cruise Terminal, maritime uses and a growing number of last-mile logistics facilities sit alongside a small residential neighborhood and Van Brunt Street’s restaurants and shops.

Superstorm Sandy flooded much of Red Hook in 2012, and flood risk is now central to any purchase or build-out here. Industrial users like Red Hook for its proximity to Manhattan and the BQE. Buyers should study elevation, flood insurance, resilience upgrades and truck routing on narrow streets.

Bushwick

Bushwick and the adjoining East Williamsburg industrial area combine large warehouse buildings, artist studios, nightlife, restaurants and a big residential population. Part of the area is in the East Williamsburg Industrial Business Zone, and industrial and manufacturing users still operate here alongside event spaces, breweries and creative offices.

Rents are generally below Williamsburg, which draws tenants looking for raw space. Investors find older warehouses and mixed-use buildings with conversion or repositioning potential, but zoning, building condition and the residential rent status all need careful review. The L and M trains are the transit backbone.

Sunset Park

Sunset Park’s waterfront holds some of the city’s most important industrial complexes, including Industry City, Bush Terminal and the Brooklyn Army Terminal, along with newer last-mile distribution facilities. Inland, Fifth Avenue and Eighth Avenue are busy neighborhood retail corridors with strong local ownership.

Manufacturers, food producers, distributors, creative companies and logistics operators lease here for space, loading and access to the Gowanus Expressway. Much of the waterfront sits within the Southwest Brooklyn Industrial Business Zone, and the city has been protective of industrial land in this area, so residential conversion is not a realistic plan for most sites.

How we size a Brooklyn development site

Land in Brooklyn is priced on what can be built, so the first job is to figure that out correctly. We start with the zoning district and any special district or overlay, then calculate the allowable floor area, height and setback envelope, and parking or loading rules. City of Yes for Housing Opportunity changed several of those inputs, including parking requirements in much of the borough and density bonuses for affordable housing, so older analyses may be out of date.

Next come the programs that shape the economics: Mandatory Inclusionary Housing in rezoned areas, the 485-x tax benefit for new rental construction, and any available development rights from neighboring lots. Air rights transfers require a zoning lot merger or similar agreement with the neighbor, which takes negotiation and legal work. Finally we test the plan against current hard and soft costs. A site that looks cheap per buildable foot can turn out expensive once foundation, environmental and affordability costs are counted. We confirm all of this with land use counsel and the project architect before a client commits.

Construction realities in Brooklyn

Building in Brooklyn means building next to someone. Most sites share a property line with an occupied building, so excavation, underpinning and support of excavation need careful engineering, and adjacent property owners often require license agreements and monitoring before work starts. Those negotiations can take time and money, and they belong in the budget from day one.

Soil and water are the other big variables. Former industrial land in Gowanus, Red Hook and parts of Greenpoint can carry environmental conditions that require testing, remediation and sometimes regulatory oversight. A high water table near the canal or the waterfront affects foundation design. Sal’s background as a Florida Certified General Contractor with hands-on construction experience in Brooklyn means we price these risks before the land deal, not after. Our Brooklyn owner’s representation service carries that same review into design, bidding and construction.

Buying a mixed-use building: a Brooklyn checklist

• Rent registration history and current status for every residential unit, read against current rent law.
• Commercial leases, including renewal options, assignment rights and whether rents are above or below market.
• Certificate of occupancy, and whether actual use matches it.
• Open Department of Buildings and HPD violations, and any ECB penalties.
• Boiler, gas lines, roof, facade and electrical service condition.
• Unused development rights and whether the building could support an addition.
• Flood zone status in low-lying areas.
• Real estate taxes, tax class and any existing exemptions or abatements and when they expire.

Our Brooklyn investment sales team works through this list with your attorney and lender.

Options for long-time Brooklyn owners

Many Brooklyn buildings are owned by families who bought them decades ago. Those owners usually face four choices: keep holding, refinance and pull out cash, develop or add on using unused floor area, or sell. A sale can be paired with a 1031 exchange into property elsewhere, including Florida.

For example, a hypothetical owner of a three-story mixed-use building in Sunset Park with mostly regulated apartments might find that selling and exchanging into a net lease property in Southwest Florida produces more income with less management. Another owner with a lot that has significant unused floor area might do better developing or selling to a developer. We run the numbers for each path, with your CPA and attorney handling the tax and legal side. See 1031 exchange advisory and our Southwest Florida market page.

Brooklyn submarkets compared

For tenants choosing between Brooklyn and Manhattan

Many companies weigh a Brooklyn office against Manhattan. Brooklyn often offers more space for the money, loft character that is hard to find in Midtown, and a short commute for staff who already live in the borough. The tradeoffs are fewer large blocks of space, older building systems in many conversions, and longer trips for staff coming from New Jersey, Westchester or Long Island.

We suggest mapping employee home zip codes first. If most of the team lives in Brooklyn or Queens, a DUMBO or Downtown Brooklyn office can cut commutes sharply. If many commute by commuter rail, Downtown Brooklyn’s Atlantic Terminal helps for Long Island, while Manhattan works better for others. Our Manhattan market page covers the other side of that comparison, and Brooklyn tenant representation explains how we run the search.

Industrial leasing in Brooklyn: what to check

Brooklyn industrial space is scarce and varied, from multi-story loft factories to modern single-story distribution buildings. Freight elevator size and capacity matter in multi-story buildings. Loading docks may be at street level or shared, and many streets have truck restrictions or tight turning radii. Power service, sprinklers, floor load and zoning for your specific use all need confirmation.

Last-mile operators also need to plan for parking for vans and trailers, which is often the hardest piece to find. Food producers should check gas service, drainage, exhaust and health department requirements. We tour with these items on a checklist and get answers in writing before a lease is drafted.

Working with us in Brooklyn

Tell us what you are trying to do: lease, buy, sell, build or simply understand what a property is worth and what it could become. We will look at the zoning, the building and the numbers, and give you a straight answer. Call or text 239-256-5005, email info@diberealestate.com, or use the contact page. Our Brooklyn development sites page covers land and assemblages in more depth.

Retail corridors beyond the headline neighborhoods

Some of Brooklyn’s steadiest retail sits on neighborhood corridors rather than in the famous districts. Fifth Avenue and Eighth Avenue in Sunset Park, Manhattan Avenue in Greenpoint, Knickerbocker and Myrtle Avenues in Bushwick and Van Brunt Street in Red Hook each serve a loyal local customer base. Ownership is often local and long-held, leases tend to be simpler, and tenants are frequently independent operators.

For retailers, these corridors can offer lower occupancy costs and less competition from national chains. For investors, a well-leased building on a strong local corridor can be a durable hold. In both cases we study daytime and evening foot traffic on the actual block, nearby transit entrances, and what similar storefronts have leased for recently, rather than relying on asking rents.