Multifamily Brooklyn Report – Winter 2019
- Feb 01, 2019
The Brooklyn multifamily market continued to grow at a strong rate, reaching a new cycle high for deliveries. More than 4,400 units had been delivered in the borough as of November, with almost all of the new inventory geared toward the upscale segment. Despite significant deliveries, rents for Lifestyle assets grew 3.4 percent and the occupancy rate in stabilized high-end assets stayed at 98.1 percent, among the highest in the U.S.
New York City added 93,000 jobs year-over-year through September, with education and health services continuing to lead employment growth. Roughly $664 million is set to be invested in a 32-site ambulatory care network and hospital improvements, meaning the sector is likely to remain an anchor for the borough’s economy. Major projects such as the 6.5 million-square-foot Industry City and Williamsburg’s Domino redevelopment, which features 2,800 units across four buildings and 800,000 square feet of commercial space, are likely to further bolster development in the borough.
Multifamily transaction activity intensified in Brooklyn, with the total investment level reaching $1.5 billion in the first 11 months of 2018. Investors favored value-add product, so per-unit prices contracted significantly. With 11,600 units underway, stock should further expand in 2019, tempering rent growth and appeasing rental demand.