From left at the Brooklyn Real Estate Summit: Tim King of CPEX, Joe Chan of the Downtown Brooklyn Partnership and Michael Phillips of Jamestown; Michael Zazza of the Zazza Development Group and Susan Pollock of CPC Resources
Though the price disparity in their residential markets may be narrowing,
Brooklyn still lags far behind Manhattan in the number of big national
retailers. That was a major discussion point at the 2011 Brooklyn Real
Estate Summit held yesterday at St. Francis College in Downtown
Brooklyn. Not coincidentally, commercial real estate veterans pointed
to the very neighborhood where the conference took place, Downtown
Brooklyn, as crucial to landing those retailers.
“Brooklyn is too spread out to achieve national retailers in every business
district in the borough,” said Michael Phillips, managing director at
real estate investor Jamestown, which has stakes in [email protected] in Downtown Brooklyn and four Manhattan buildings. But, by trumpeting Downtown Brooklyn, where retail traffic is already evident, Brooklyn
can lure the big-box national retailer willing to be a pioneer. Once that
first successful anchor arrives, Phillips predicts a wave of followers will
flock to the rest of the borough. Downtown Brooklyn already has the “critical mass,”, he said, to capture retailers’
attention. There’s a highly successful Aeropostale near the Fulton Mall that
opened last fall, and an H&M planned for Bridge Street.
Joe Chan, president of the Downtown Brooklyn Partnership, also announced that the Gap
signed a lease to open a store in the Fulton Mall.
But there are still some major obstacles to overcome before Brooklyn gets
the flood of big-name retailers its population size warrants.
Both Phillips and Tim King, managing director at CPEX Real Estate,
agreed with Joe Chan, president of the Downtown Brooklyn Partnership,
who said that too many retailers don’t understand the Brooklyn market.
“They find it hard to figure out if Brooklyn is a suburban model
or an urban model,” Phillips said.
King added that retailers are “trying to take their square peg and fit it into our round hole.” Brooklyn needs “nimble retailers,” willing to change models
that have worked elsewhere to fit into Brooklyn’s unique market and strict
zoning laws, which King called “antiquated.”
While Downtown Brooklyn is trying to compete with Manhattan in
retail, Williamsburg has already begun rivaling it in the number of
recently developed glassy condominiums. Granted, many Williamsburg condos stalled during the
housing crash, but because of the local market’s rapid recovery,
Aptsandlofts.com founder David Maundrell said he believes many of
those projects will be “alive and kicking… by the end of the year.” He
added: “We have an inventory shortage, not only in rentals where the
market has always been strong, but in condos, too.” (That sentiment is
supported by recently released first-quarter market reports in Brooklyn).
The residential activity is beginning
to spur some development in the hotel sector, too, as Two Trees
Management is set to bring a hotel to the Williamsburg sometime in the middle or at
the end of next year, according to Jed Walentas, a vice president with the
Dumbo-based firm. The still unnamed hotel is going up on Wythe Avenue
across from bowling, restaurant and nightclub establishment Brooklyn
Bowl, and will remain viable by competing with other New York City hotels
prices, Walentas said. In addition to the young media businesses who
work in the area, it will cater to “an artistic community that can’t afford a hip
hotel in Soho or Meatpacking, and might prefer a hip Williamsburg hotel to
a Holiday Inn in Midtown.”
These signs of growth, along with the ubiquity of young families, are evidence of the maturing market along the Williamsburg waterfront
and Bedford Avenue. Meanwhile the young, artistic crowd that gave
Williamsburg its identity is being priced out, moving further east along the L subway line, Maundrell said.