Brooklyn Retail Scene Red Hot: Report
A new report from CPEX Real Estate confirms what many had already suspected: the number of retail stores in Brooklyn continues to grow expeditiously and shows no signs of slowing down.
CPEX’s 2015 Brooklyn Retail Report, which covers the borough’s retail activity in 2014, highlights that the number of active retail corridors in Brooklyn grew to 121 at the end of 2014, up from 88 corridors at the same time in 2013. A year earlier, that figure was 67.
“The one thing that we really found shocking was the growth of the corridors since 2013,” Ryan Condren, the managing director of retail leasing at CPEX, told Commercial Observer. “To grow over 80 percent in two years is remarkable.”
Of all the Brooklyn neighborhoods, Park Slope has the most retail corridors with 15, followed by Williamsburg with 13 and Crown Heights with seven. At the end of 2014, 13 retail corridors in Kings County had asking rents that exceeded $100 per square foot. In 2013, there were eight.
Some neighborhoods which have historically have had a dearth of shopping options have been particularly impacted by the growth of retail in the borough. Bedford-Stuyvesant saw 33 new shops open in 2014 alone. And many national retailers made Brooklyn their home for the first time last year, including Apple and Madewell in Williamsburg, JCPenney in East New York and Neiman Marcus in Downtown Brooklyn.
The report attributes much of the explosive retail growth to the rapid increase in residential units in the borough. Since 2013, the number of new building permits in Brooklyn for residential properties increased 116 percent, the report says. The average household income in the borough today is $150,000.
“It was only a matter of time,” said Mr. Condren, referring to the borough’s eye-popping retail growth. “Brooklyn is going back to its roots as being its own city and not being dependent on Manhattan. We’ve always had the infrastructure in place. Not only has the residential density gotten stronger, but office vacancy rates are at historic lows.”
Mr. Condren recommended that real estate professionals keep an eye on Sunset Park and Prospect-Lefferts Gardens for potential growth.
“It’s [these] submarket that I would be really bullish on,” he said. “The way that Bushwick and Crown Heights have exploded in the past few years, I think Sunset Park and Prospect-Lefferts Gardens will see similar growth.”