A Booming Borough: Experts Talk Brooklyn at CO’s 2025 Market Forum

Brooklyn commercial real estate is back in vogue, with interest being driven by ambitious, adaptive reuse projects like the 1.2 million-square-foot office campus at Dumbo Heights, the Brooklyn Navy Yards, and all 6 million square feet of Industry City in Sunset Park.

On Wednesday, several leading Brooklyn real estate professionals and politicians held court at Commercial Observer’s 2025 Brooklyn Market Forum. Hosted at the 25,000-square-foot penthouse office at Dumbo Heights, a building managed by Kushner Companies and RFR Holding, the speakers all touched on not just why Brooklyn real estate is still so valuable, but also on what needs to be done to improve living standards for residents and businesses in the borough. 

Brooklyn Borough President Antonio Reynoso opened the forum by calling for more rental housing to be built. He pointed out that Brooklyn has experienced a net loss of housing units over the past decade, and noted that the average monthly rent on one-bedroom apartments is now $3,500,

Reynoso said that his office has supported various city-sponsored housing plans, including the 4,600 units that will be brought to market through the Atlantic Avenue Mixed-Use Plan, and the 250 units that will be added through the Windsor Terrance residential high-rise project, overseen by Apex Development.  

“If you noticed a common thread, it’s that my office is consistently calling for more,” Reynoso said “This piecemeal approach that’s been a status quo for decades is failing to deliver adequate relief for families.” He added that politicians can’t expect Downtown Brooklyn and North Parkway to bear the burden of new residential production. 

“We need new housing, plain and simple, but we need to do it right and plan for the public good,” he added. “There’s room in the city for all of it — market rate, affordable, every single type.” 

Melissa Burch, chief operating officer of the New York City Economic Development Corporation, took the stage next. She emphasized the strength of the Brooklyn economy, which has regained all 1 million jobs it lost during COVID-19, and added 75,000 more jobs than it had prior to the pandemic, many of those in finance, health care and professional services. 

Burch listed countless government tax incentives that have supercharged real estate development across the borough, including the affordable housing tax incentive 485x, the multiple dwelling unit tax incentive 467m, and Executive Order 43. Order 43 evaluates any piece of public land for housing development, and is responsible for redeveloping a parking lot in Coney Island into a new housing development the size of four city blocks, with 25 percent of units reserved for affordable housing. 

“We have an opportunity to redevelop that site … and that is an example of how we can figure out how to accommodate the beach and Cyclone’s parking, using the strength of the market, to bring more mixed-income-style housing to Coney Island,” she said.

Burch also touched on the redevelopment of the Brooklyn Marine Terminal, a 122-acre site in Red Hook that was under control of the Port Authority for decades before falling into disrepair. The EDC and City of New York acquired the site and are now in the process of planning how to redevelop an enormous swath of waterfront property. 

“It will include both a modern marine terminal, as well as new mixed-income housing and public amenities,” she said. “There is a historic opportunity there to think about how we envision this swath of land that has undergone decades of disinvestment, and how we can invest into it, and put jobs at the center of that development program.” 

The largest panel of the day included several Brooklyn real estate executives discussing the economic renaissance the borough has experienced in recent years. 

Randy Peers, president and CEO of the Brooklyn Chamber of Commerce, pointed out that during COVID, Brooklyn’s real estate market wasn’t as reliant on office workers returning to work, at least compared to Manhattan. That opened secondary and tertiary markets across the borough to do well as more residents worked from home and shopped locally, He noted that Kings County has outpaced the nation in job growth by 4 percent from 2023 to 2024. 

“Brooklyn is booming, and live-work-play has really come to fruition here in terms of the new urban model for how cities grow,” said Peers, who tempered his praise by noting how much the borough is likely to suffer from a loss of migrant labor under Donald Trump’s second administration.

“The loss of migrant and immigrant labor will impact the restaurant and hospitality sector. Even legal immigrant workers are afraid to show up to work right now,” he said.  

Regina Myer, president of the Downtown Brooklyn Partnership, echoed Peers’s positive summary of Brooklyn’s real estate market by noting that 22,000 housing units have been built in recent years and that 8,000 units are currently under construction, including some in the 74-story mixed-use skyscraper known as Brooklyn Tower.  

“No.1, the residential market couldn’t be stronger,” said Myer. “Including Brooklyn Tower, this really is fueling the transformation of Downtown Brooklyn into a truly mixed-use neighborhood.” 

Dan Marks, CEO of brokerage TerraCRG, admitted that while there is “so much optimism” in Brooklyn due to the passage of 485x, many professionals in the borough recognize that national political uncertainty from the 2024 presidential election was quickly followed by local political uncertainty as the 2025 New York City mayor’s race kicks off in earnest this spring.

“We have local politics that have reared its ugly head, and now we really have to pay attention to what will happen in 2025,” said Marks. “Just when you’re past some political uncertainty, something new pops up.”

Miki Naftali, chairman and CEO of the Naftali Group, spoke to the reasoning behind his firm’s enormous push into Brooklyn. 

The Naftali Group has built five residential buildings in the borough, including the $1 billion condo and residence, Olympia Dumbo waterfront condo. Naftali said there’s a reason his firm decided to invest in luxury residential property, rather than affordable housing. 

“As far as we see it, the market is strong. … What we are building and developing is following the demand of the market,” he said. “We’re not building big four- or five-bedroom apartments for a very specific reason: In our specific location, there’s no demand for those apartments.” 

Peers closed the discussion by admitting that “Brooklyn is not the affordable alternative to Manhattan anymore,” in part because the borough has become an international brand. 

“Brooklyn is the place people want to be, the hype is real,” he said, adding that Seoul, South Korea, has an entire district of the city marketed as “The Brooklyn of Seoul.”

The penultimate panel was an exclusive discussion on the host building for the event, Dumbo Heights. The five-building, 750,000-square-foot, mixed-use office campus has been completely redeveloped since Kushner Companies acquired it in 2013, together with partner RFR Holding. 

Kushner Vice President Nick Maki said that when Dumbo Heights opened in 2017, after a $150 million renovation, it was a period before the amenitization of many office buildings in Manhattan, and the project has inspired new types of repurposed office developers across the five boroughs. 

“We were able to offer a product that didn’t really exist in the New York City area, with rooftop amenities and big open spaces,” he said. “And as people saw our success … you began to see the movement toward that in Manhattan, so it has created increased competition.”

Maki added that Dumbo Heights carried 95 percent occupancy prior to COVID hitting in 2020. 

Max Swerdloff, a senior analyst at Alvarez & Marsal Property Solutions, said his firm had to refocus on the best use of space at the property since COVID, which has led to his firm re-tenant the building’s entire retail base over the past three years. 

“You have the ability to handpick tenants and merchandize it in a way that each tenant feeds off each other,” he said, noting that the building has added an early child care center and an Ippudo restaurant in recent years. “We’re over 95 percent leased and stabilized on the retail. … Instead of focusing on the last dollar, we focus on the right users for a long-term, stabilized asset.”  

Dean Lambert, vice president of asset management at RFR Holding, discussed the four-year extension his sponsorship team received last year on the $480 million loan secured by the property. 

“We had a big win last year in our loan modification and extension — it brought us back to the market from a leasing front,” he said. “It offers us that stability, that alignment with the market, which is so important at this time … and it shows we’re ready to transact and lease.” 

The forum’s final panel examined the Brooklyn phenomenon of repurposing derelict, waterfront, industrial property into income-producing mixed-use properties. 

Alyssa Zahler, managing director of commercial leasing at Two Trees Management, recounted how her firm purchased 13 buildings in Dumbo and Williamsburg for $12 million in 1985, and has since created the current Brooklyn Bridge waterfront economy, replete with an outdoor campus, the Domino Park refinery site, and mixed-use office space. 

Zahler said the mixed-use campus model of redevelopment allows Two Trees to “really dig in” and become actively involved in the business improvement, parks creation and local residents, including those within the firm’s neighborhood residential portfolio. 

“We’re able to be really nimble and get a pulse of what’s going on with our tenants, and it’s nice to have that crossover as well for our residential tenants,” she said. “In Williamsburg, we have people who office with us, and then buy condos with us, or rent with us … and become entrenched in that Williamsburg waterfront lifestyle.”

Lindsay Greene, president and CEO of the Brooklyn Navy Yard, a 300-acre manufacturing and innovation campus that is home to 500 businesses and 13,000 workers, said her mixed-use asset is an economic development organization that aims to have a different type of tenant base than those managed by private firms, namely one seeking shorter lease terms. 

“Our core focus is finding companies that have a need for the kind of industrial space we offer,” she said. “We don’t pursue the same type of economics that other landlords do. … We do pretty short-term leases, our terms are three years … but a lot of our folks move around a lot.”

Jim Somoza, managing director of Industry City in Sunset Park, noted that at 6 million square feet Industry City was the largest adaptive reuse project in the United States, which required him to find tenants for ground-floor retail, upper-floor office space, and warehouse and distribution tenants. 

“At 6 million square feet, you can’t be as picky as we used to be when I was at Chelsea Market, which was only 1 million square feet,” he said, listing the wide variety of tenants he has secured over the last five years. 

“That is all to create a place for people that want to come and work in a place that they feel they enjoy,” he said. “What we feel that we create is a counter to the remote-work movement.”

(Disclosure: Joseph Meyer, chairman of Commercial Observer owner Observer Media, is married to Nicole Kushner Meyer, president of Kushner Companies.)

Brian Pascus can be reached at bpascus@commercialobserver.com