Which Three Areas Changed The Most In 2016?
Over the past year, GFI research analyst Justin Fitzsimmons has chatted with Bisnow about the areas of New York City that are experiencing the greatest change. As we head into 2017, let's take a look back at the greatest NYC shifts in culture and property values.
Brooklyn: The borough has spent the better part of the 21st century serving as the poster child for gentrification. Neighborhoods that were once affordable compromises for those looking to work and play in Manhattan are now sought-after hotspots with soaring rents. But the allure is not limited to the residential realm.
In 2015 alone, more than $1B was spent on office space and investment properties in Brooklyn. That's a 55% jump from 2014. So why the commercial surge?
Justin points out that as Brooklyn's population climbs past 2.6 million, it has become the city's most populous borough and the second-most densely populated county in the country.
"As Brooklyn has been revitalized," Justin said, "and developed its own unique character, many firms have chosen to move across the East River to better recruit the creative and innovative individuals associated with the borough, while giving their employees shorter commutes."
Brooklyn is rolling into 2017 as the place to live, play and work.
Gowanus: The borough as a whole is evolving into a desirable location for office tenants. But as residential sections grow into commercial epicenters, another Brooklyn neighborhood, once known as an industrial hub, is shifting into an attractive spot to live and play.
Only a few short years ago, Gowanus was defined by the two miles of polluted canal that runs through it. Thanks in part to a $500M cleanup of the waterway, which launched this year, investment capital has begun to flow toward the area.
With the scars of the past fading away, retailers like Whole Foods have planted their flags. With zoning changes on the horizon, 2016 will likely serve as a launching pad to bigger and better things for Gowanus. In addition to the new office space with tenants like Cowrk.rs, The Yard and Genius Media, the flush pipeline of boutique hotels also speaks to the changes that the area is undergoing.
"New retail establishments, like boutique spas, yoga studios and craft beer bars, have been popping up to meet the growing and, what many see as inevitable, demand," Justin said. "Residential demand, should it be allowed to thrive via rezoning, is sure to follow."
South Bronx: Justin tells us that the Bronx saw a 54% spike in residential construction this year, and two slices of the South Bronx are standing out from the pack.
For Mott Haven and Port Morris, 2016 brought some big changes to all sectors of the real estate market and developers have been steadily moving forward with the construction of new residential and commercial buildings.
Keith Rubenstein's Somerset Partners—teaming up with the Chetrit Group to construct a massive, six-tower waterfront community—has already backed a new coffee shop that opened last spring and acquired a substantial warehouse that he will be converting into a Chelsea Market-style food hall, complete with a rooftop beer garden.
Horning Capital and Savanna put the finishing touches on their revitalization of the 172k SF office building they acquired in 2015 (The Bruckner Building). Bluestone Group and Altmark Group teamed up on the $44M acquisition, brokered by GFI, of an industrial building that will be converted to office space.
Justin said it's not too late to get in on the ground floor in this area, but the amount of development in the pipeline and the influx of capital that the area has seen over the last year makes it clear that values will continue to head north in the South Bronx.
To learn more about this Bisnow content partner, click here.