Summer 2015 Dumbo Commercial Real Estate Update

Baci at Pearl Street Dumbo

Baci at Pearl Street Dumbo

We received the following commercial real estate update from Chris Havens, Vice President of Commercial Property at

As you may have heard, another 120,000 RSF of office space is leased or lease out at Dumbo Heights. ETSY now has possession of their building, promising a stunning and innovative build-out at a level never before seen in Brooklyn.

Two Trees continues to get great numbers for their product. I showed a prime view space in 20 Jay last week asking $49/rsf. Brokers and owners get Manhattan calls as you know, almost all of which can’t be fulfilled. When WeWork opens in what I like to call D Heights, combined with Pearl Realty’s Green-Desk, DUMBO will have by far the most co-working space in one area of Brooklyn.

Retail supply continues to be tight, but without the kind of rents one sees in denser areas. I am guessing the best rent comes via percentage at the One Old Fulton Shake Shack facing the Park. Around the borough, where asking rents are often too high for the only product type with much space left – small retail – you see overreaching based on marquee deals not reflective of the typical market. In DUMBO there are some ambitious asks going begging. And some retailers here say the shopping population has changed greatly with the huge influx of tourists, with dry goods harder to sell.

Dumbo Heights is bringing food and service retailers to their campus, at affordable rents. Other new developments now under construction have little retail space due to the high value of ground floor residential and parking spaces. One John does have a super prime park and waterfront restaurant space. Starwood has leased space to a restaurant at the base of the hotel they and Toll NYC built.

185 Front, 51 Jay, 47 Bridge and One John are building, marketing and selling. As David Walentas predicted decades ago, DUMBO has become super prime residential.

Programming by the Park Conservancy and the Dumbo Improvement District bring both tourists and locals, giving a strong sense of life to the area. Area residents and tenants regularly say more restaurants are needed, yet the high cost barriers to entry, the lack of proper space or 10 year lease terms hamper that effort.

I am told that up to three different child play spaces are coming, the first called RECESS at 81 Washington in the old Pomme space. One or more gyms are close to a deal as well. 135 Plymouth, settled down as residential now, has much activity in their ground floor space.

55 Water/Empire Stores is well into its renovation, with the guts of the building visible now. Several excellent retail deals have been announced. The Dock Street building, feared for its proximity to the Brooklyn Bridge, couldn’t have a more subtle, light and lovely façade, in my opinion. And the new middle school will be much welcomed by area families.

{February 2015 Dumbo Commercial Real Estate Update, 25Feb2015}
{Spring 2014 Dumbo Commercial Real Estate Update, 16Apr2014}
{Dumbo Commercial Real Estate Update (December 2013), 16Dec2013}
{Dumbo Commercial Real Estate Update (June 2013), 02Jul2013}
{Dumbo Brooklyn Commercial Report (March 2012), 12Mar2012}
{Dumbo Brooklyn Retail Report (Jan 2012), 13Jan2012}
{Dumbo Retail Report (Dec 2011), 16Dec2011}
{Dumbo Commercial Real Estate Update (Nov 2011), 22Nov2011}