Italian restaurant Rucola recently opened at 190 Dean Street.Developer Abby Hamlin knew she was taking a risk when she bought a block of Boerum Hill properties in 2004 in a joint venture with Francis Greenburger’s Time Equities.
But Hamlin, a longtime Brooklyn resident and the founder of Hamlin Equities, felt confident in her plan to build 23 new construction townhouses there.
“Boerum Hill was thought to be somewhat edgy at that time,” she recalled. Still, “I didn’t need any convincing. It was within walking distance to everything, had 14 subway lines and was five minutes to Wall Street.”
The first phase of her project, known as 14 Town Houses, went on the market in 2007 with the houses listed at around $2 million — a price point that was “unheard of” for the area at the time, Hamlin said.
But they all sold for $2 to $3 million, Hamlin said, and when the first resale occurred this summer, it fetched $3.4 million.
The second phase of the project, 9 Town Houses, is being constructed now. When the houses hit the market this spring, they will be priced drastically higher than the first phase — between $3.5 and $4 million each.
Hamlin isn’t the only one seeing a return on her investment in the rapidly evolving neighborhood.
Boerum Hill — the 50-block area sandwiched between Cobble Hill, Park Slope, Fort Greene and Gowanus — has easy subway access and brownstone-filled blocks. But for years it had a reputation as grittier and less safe than neighboring areas, due in part to the presence of the Gowanus Houses, a public housing project, and the Brooklyn House of Detention. But the area has seen a recent surge in demand from buyers and developers alike.
“It’s become very high on people’s wish lists,” said Citi Habitats vice president Anthony DelleCave, a Brooklyn native. “Only five years ago, no one wanted to live in Boerum Hill. Now, prices are through the roof and the demand is there.”
Boerum Hill brownstonesCool and convenient
In 2011, the average sale price of a home in Boerum Hill was $810,915, up 16 percent from $697,318 the previous year, according to data compiled by listings website StreetEasy. By comparison, average prices in Brooklyn as a whole rose only 5.9 percent during the same period, to $523,808.
The rental market, particularly, reflected the neighborhood’s popularity: In 2012’s first quarter, the median asking rent in Boerum Hill rose 14.3 percent to $3,200 per month, up from $2,800 per month in the same period of last year. Throughout Brooklyn, median rents grew 11 percent during that time.
“Boerum Hill is probably the coolest neighborhood in Brooklyn right now,” said Brooklyn resident Terry Naini, a senior vice president at the residential brokerage Town.
That wasn’t always the case.
“I remember when Smith, Court and Hoyt were the ‘West Side Story’ of Brooklyn,” said Toqir Choudri, a longtime area resident who manages the Cobble Hill Rapid Realty office.
Then, in 2005, hot Hollywood couple Heath Ledger and Michelle Williams bought a house on Hoyt Street for $3.5 million, focusing international attention on the changing demographics of the small neighborhood.
And while the housing projects used to define the area, “now it’s as if everybody else has encapsulated the projects, rather than the projects influencing the neighboring properties,” Naini said.
Hamlin’s 14 Town Houses, which account for some of the neighborhood’s priciest sales (all but one of the top 10 priciest sales since 2006, according to StreetEasy), are just blocks from the Gowanus projects.
One big shift that’s helping drive the increased demand for Boerum Hill, brokers said, is new retail along Smith Street and elsewhere in the neighborhood.
In Boerum Hill, “the retail profile is changing,” said Prudential Douglas Elliman’s James Kerby, who is marketing a townhouse at 94 Bergen Street.
Boutiques, yoga studios, hip clothing chains and the macaron shop Vendôme Haute Parisien Macarons can now be found in Boerum Hill.
In the last year, the neighborhood has seen several trendy restaurants open, including Rucola at 190 Dean Street, a Northern Italian restaurant so popular it often has a two-hour wait on weekends. Other newcomers include eatery Burger on Smith; Sottocasa, a pizzeria that made headlines for using a crane to install a 4,000-pound oven into an old brownstone at 298 Atlantic Avenue; and Maimonide of Brooklyn, a vegetarian and vegan restaurant at 525 Atlantic Avenue.
These additions are crucial for building residential demand, said Elliman’s Scott Klein, who is marketing a townhouse at 140 Bergen.
“Restaurants and shops are what changes the neighborhood,” he said. “People want to go out and walk and eat. If you don’t have the retail, you don’t see the dynamic changes that we’ve seen in Williamsburg, Cobble Hill and Boerum Hill.”
The newcomers
When it comes to new development, Naini noted that “there’s really just not much space” in Boerum Hill.
Still, several new projects are in the works, and some development projects stalled by the financial crisis are now getting back on track.
Permits were recently renewed for 252 Atlantic Avenue, on the border of Cobble Hill and Boerum Hill, where plans for a 66-unit building were first filed in 2008. Next door is 262–276 Atlantic Avenue, an empty lot and three vacant storefronts, which were bought last summer with possible plans for a seven-story apartment building, according to permits and city sale records.
In January, Quinlan Development Group paid $6.2 million for an old warehouse at 259 Pacific Street, and is reportedly planning to build a 60-unit rental building there.
Joe Sitt’s Thor Equities bought 292–294 Atlantic Avenue in February for a reported $5.4 million, and has plans to remodel the 6,000 square feet of retail space and renovate the apartments upstairs. The New St. Clair Diner, which has been open in the building since 1967, will close.
Additional townhouses on State Street are also in the works.
In 2009, developer IBEC reportedly filed plans for six 5,500-square-foot, elevator townhouses, but never broke ground. In December, however, the developer asked permission from Community Board 2 to install stoops on the new townhouses, indicating that the project has been revived. Prices for these brownstones would reportedly be around $4 million each.