Asking Rents For Prime 7th Avenue Retail Space Up
The Real Estate Board of New York (REBNY) released its Winter 2017 Brooklyn Retail Report yesterday, revealing that the average asking rents for available ground floor retail spaces have increased in seven of the fifteen Brooklyn retail corridors analyzed.
The average asking rents for prime retail spaces remained steady in three corridors and decreased in the remaining five. These decreases are partly attributed to nearby areas offering lower-prices for available retail space—such as Smith Street having lower-priced ground floor retail options versus Court Street.
Areas with new residential development or significant residential projects in-progress show the highest increase in asking rents when compared to REBNY’s Winter 2016 Report.
Franklin Street between Meserole Avenue and Commercial Street in Greenpoint saw the highest increase in asking rent at 41% or $89/square foot compared to Winter 2016, while 7th Avenue in Park Slope came in second with a 35% increase at $129/square foot.
According a REBNY, Franklin Street’s bump up is a result of “rapid change with new residential projects” in the area, while 7th Avenue’s is due to “very low ground floor retail inventory being concentrated in more desirable locations along the corridor, which drove the average asking rent upward.”
86th Street between 4th Avenue and Fort Hamilton Pkwy in Bay Ridge came in third with a 29% increase at $110/square foot for ground floor retail space versus $85 from last year.
Washington Street between Main and Water Streets in DUMBO saw a 13% rise in asking rents at $127/square foot while the Fulton Street corridor between Boerum Place and Flatbush Avenue saw an 8% rise with a whopping asking rent of $326/square foot.
The Report states the increase on Fulton Street can be attributed to the seemingly endless numbers of residential towers being developed in the area as well as to new retailers hoping to attract “spillover” customers from City Point.
Brooklyn Heights’ Montague Street spanning Hicks Street to Cadman Plaza, and Prospect Heights’ Flatbush Avenue from 5th Avenue to Grand Army Plaza both remained the same since Winter 2016, with asking rents at $188/square foot and $102/square foot, respectively.
The Report notes that the Flatbush Avenue corridor has remained the same since REBNY began compiling these reports in Summer 2015, however they see the strip’s potential to increase significantly with the Pacific Park residential project in the works.
Over in Cobble Hill, Court Street between Atlantic Avenue and Carroll Street experienced a -14% drop to $151/square foot whereas asking rents along this corridor were $175 in Winter 2016. Smith Street between the same borders also saw a decline of -12% down to $122 versus $139 in Winter 2016.
According to the Report, leasing on Court Street has slowed due to competition from the adjacent Smith Street which offers lower asking prices for ground floor retail spaces.
Park Slope’s 5th Avenue between Union to 9th Street also saw a decrease of -8% down to $78/square foot as opposed to $85/square foot from Winter 2016. Hopefully these lower asking prices will help to fill up the many empty storefronts currently lining 5th Avenue.
See the full REBNY Winter 2017 Brooklyn Retail Report here.