Downtown Brooklyn’s commercial office market continues to be tight, with 17 million square feet of office space occupied for a vacancy rate of 3.4 percent, according to a new report from the Downtown Brooklyn Partnership.Like the borough at large, Downtown Brooklyn continues to benefit from increased office demand. The report noted how that demand – from tenants like Hillary Clinton, who signed an 80,000-square-foot lease earlier this year to house her presidential campaign at Forest City’s One Pierrepont Plaza – has driven vacancy rates to a city low.
Compared to Downtown Brooklyn’s 3.4 percent vacancy rate at the end of the second quarter, Midtown Manhattan’s vacancy rate stood at 8.9 percent and Lower Manhattan’s at 10.3 percent, while the notoriously tight Midtown South market’s vacancy rate was 6.2 percent.
Downtown Brooklyn residential construction statistics (credit: Downtown Brooklyn Partnership)
The report cited projects like Quinlan Development’s 230,000-square-foot 41 Flatbush Avenue – the “first large-scale all commercial office project since 12 MetroTech Center opened in 2005” – and Tishman Speyer’s recent acquisition of Macy’s 422 Fulton Street location as “positioned to cater to the growing innovation and creative sectors.”
But the bulk of new development in Downtown Brooklyn continues to be residential, with six new projects that started construction in the first half of this year looking to add 1,052 units to 5,300 already in construction. The report also noted another 8,400 units “in the pipeline.”
Nearly $6.4 billion of private sector funds have been invested in Downtown Brooklyn since 2004, according to the Downtown Brooklyn Partnership, with another $4.2 billion in funding expected over the coming years.