Brooklyn developers bet on rentals over condos
Developers are betting on Brooklyn rentals over condominiums as the borough’s rent growth continues to outpace Manhattan’s, and neighborhoods such as Bushwick, Greenpoint and Crown Heights become increasingly attractive to professionals.
About 15,300 new Brooklyn rental units are under construction or planned in the next two years, compared with just 1,700 planned condos, according to data from residential brokerage MNS. Brooklyn’s median apartment rent hit a five-year high in August at $2,850, representing a 4.6 percent increase year-over-year, according to Miller Samuel data. In comparison, Manhattan median rents increased 1.8 percent year-over-year to $3,150.
Douglaston Development, for example, is building a 510-unit luxury rental tower — likely the 1 North 4th Place project — in Williamsburg, Bloomberg News reported. Its last big venture in the area was a 565-unit condo project, but the anxiety of rising interest rates made a rental more attractive this time around, Jeffrey Levine, chairman of Douglaston, told Bloomberg.
“Greed is always tempered by fear,” Levine said.
In Manhattan, sky-high land prices – reaching up to $800 per square foot in some cases – make rentals less attractive. Indeed, only 5,850 rental properties are under construction in Manhattan, a third of the number in Brooklyn, the MNS data show. [Bloomberg News] – Hiten Samtani