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Brooklyn New
Development Market Report

3rd Quarter 2014

Introduction

MNS is proud to present the Third Quarter 2014 edition of our New Development Market

New Development Sales data, defined as such “Arms-Length” first offering transactions where the seller is considered a “Sponsor”, was compiled from the Automated City Register Information System (ACRIS) for sponsor sales that traded during the Third Quarter of 2014 (7/01/14 – 9/30/14). All data summarized is on a median basis.

Market Snapshot

Year-Over-Year Median PPSF - down 12.7%
Quarter-Over-Quarter Median PPSF - down 25.4%

Year-Over-Year Median Sales Price - up 11.6%
Quarter-Over-Quarter Median Sales Price - down 10.2%

Brooklyn New Development Sales Inventory - down 60.3% from 3q14
Neighborhood with the Most New Dev Sales - Clinton Hill 35% of all Brooklyn

Total New Development Sales Volume - up -69.2% to $52.3 Million from $169.6 Million in 3q14

Largest Quarterly Up-Swing: Boerum Hill/Cobble Hill
PPSF $868/SF from $700/SF
Sales Price $1M from $661K

Largest Quarterly Down-Swing: Brooklyn Heights
PPSF $573/SF from $1,262/SF
Sales Price $725K from $2M

Highest New Development Sale:
Park Slope - 777 Carroll Street - 1 - $2,545,625

Highest New Development Sale PPSF:
Dumbo - 70 Washington Street - PHJ - $1,651/SF

Market summary:

The total number of New Development Sponsor sales in Brooklyn fell down 60.31% from 3q14. The following neighborhoods did not account for any New Development sales during this time: Bay Ridge, Bushwick, Gowanus, Kensington, and Prospect-Lefferts Gardens. The drastic decrease in the number of sponsor sales in Brooklyn is likely due to the slower maturation of the market in certain more established neighborhoods such as Williamsburg, however with several new developments and conversions in the pipeline this number expected to increase in upcoming quarters. Median sales pricing in all of Brooklyn decreased 10.2% from the previous quarter and Median Price per Square Foot decreased 25.4% compared to 3q14.

Market up-swings:

This past quarter sponsor sales in Boerum Hill-Cobble Hill only accounted for 5.77% of all New Development sponsor sales in Brooklyn, however saw the greatest uptick in prices. Despite experiencing a significant drop last quarter this area is back to customary prices levels and is continuing its rise. Since 3q14 Median Price per Square Foot increased 24% from $700 to $868 and Median Sales Price increased 53.3% from $661,080 to $1,013,158. These large shifts are due to luxury units that closed at 138 Sackett Street entering the market, while lower priced closings at Cobble Hill Towers have exited the market. Also deserving mention is DUMBO which has seen a steady, yet less dramatic, rise in prices dating back to 2Q13.

Market down-swings:

This quarter’s largest market down-swing was seen in Brooklyn Heights. Median Price per Square Foot fell 54.6% from $1,262 to $573 and Median Sales Price fell 68.9% from $2,329,247 to $725,503. This was the result of a significant inventory drop from last quarter as unit sales fell by 16 units, leaving behind only 2 closed units at One Brooklyn Bridge Park at 360 Furman Street. Furthermore, the units that exited the market were higher priced units at premier properties such as The Riverview at 183 Columbia Heights and The Heights at 30 Henry Street.

Sales Volume:

Three-Bedroom units and One-Bedroom units represented 50% and 28.85% of all sales in Brooklyn during 3Q14, respectively. The neighborhood that accounted for the highest number of New Development Sponsor unit sales was Clinton Hill with 18 transactions, 34.62% of total borough sales. This was due to an influx of units that closed at the Clinton Lofts at 91 Grand Avenue.

*Tracking: Neighborhoods where the majority of each unit type was sold in 3Q14

Studios - Bed-Stuy/Clinton Hill/Boerum Hill-Cobble Hill (33%)
One-Bedrooms - Clinton Hill (60%)
Two-Bedrooms - Clinton Hill (38%)
1200+SF Clinton Hill/Prospect Heights (19%)

The Report Explained

Included in this research are walk-up and elevator new development condominium buildings, as well as new conversion condominiums if the sales were applicable sponsor transactions. Excluded from the report are all cooperative sales.

Unit types such as studios, one-bedrooms, and two-bedroom units are grouped by square footage ranges. Studios are under 700 square feet, one-bedrooms are under 900 square feet, and two-bedrooms are under 1,450 square feet. Added to the report is the over-sized unit type that ranges from 1,500 square feet to 7,000 square feet.

Presented with a quarter-over-quarter and year-over-year comparison, both city-wide and by neighborhood, MNS New Development ReportTM tracks the market trends throughout Manhattan and Brooklyn. MNS offers a unique insight into the new development market by tracking stalled construction sites on a quarterly basis, a great indicator of where development in general is moving. MNS is your source to find neighborhood price per square foot analysis, average sale prices, unit type sales trends, overall price movement, neighborhood inventory comparisons, and absorption rates.

Can't find what you're looking for? Ask MNS for more information at www.mns.com.

CONTACT US NOW: 212.475.9000

Note: All market data is collected and compiled by MNS's marketing department. The information presented here is intended for instructive purposes only and has been gathered from sources deemed reliable, though it may be subject to errors, omissions, changes or withdrawal without notice.

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