TerraCRG, Brooklyn’s leading commercial real estate brokerage firm, today released its Brooklyn Market Report for H1 2022, analyzing investment sale transactions by asset class in Brooklyn.
Despite the volatility of the capital markets, investment sales in Brooklyn in the first half of 2022 showed nothing but stability and strength with a total dollar volume of almost $5 billion — a direct continuation of 2n.d half of 2021
Transaction volume was also in line with the prior 6-month period, with 790 investment sale transactions closed in the first half of this year, reflecting an average Brooklyn transaction size of approx. 6.3 million dollars.
On a quarterly basis, total dollar volume increased in Q2 2022, up 41% quarter over quarter to $2.9 billion.
Withstanding an unprecedented global pandemic, the Brooklyn market made a remarkable recovery in 2021, returning to pre-pandemic levels – and then some. Since the first half of 2019, the neighborhood has seen a 90% increase in total dollar volume and has also seen 120% growth in dollar volume since the first half of 2020. Remaining confident in the depth and diversity of its neighborhoods and market, Brooklyn’s unparalleled resilience has given it the ability to transform and reinvent its assets, reflected by its solid market performance in the first half of the year.
Once again, large institutional transactions were the main focus of the Brooklyn market; not only in the first quarter of 2022, but also in the first half of the year. The top 10 transactions by dollar volume accounted for 40% of the area’s total dollar volume for the first half of 2022. The Greater Downtown Brooklyn region (which includes Brownstone Brooklyn and Red Hook) again saw the largest transaction with 640 Columbia Street. hired by Amazon, for $332 billion. With $1.75 billion worth of transactions in the first half of 2022 – a 270% increase from $474 million in the last half year – activity in this region represents a significant portion of total dollar volume.
The largest number of transactions — 177 in total — occurred in the north-central neighborhoods that include Bedford-Stuyvesant, Bushwick, Crown Heights, Crown Heights South and Ocean Hill. Accounting for 22% of transactions in the first half of the year, the North Central region saw growth of 108% over the region’s total of 85 transactions in the first half of 2021.
A recovery in dollar volume was seen across all asset types during the year, with the industry jumping 352% from $204 million in 1H2021 to $921 million in 1H2022 thanks to increased demand for last-mile logistics; multifamily up 261% from $374 million to $1.35 billion due to high occupancy rates; mixed use, growing 168% from $380 million to $1 billion; retail building sales up 86% from $170 million to $317 million; office building sales increased 43% from $82 million to $117 million; housing construction up 90% from $301M to $572M from accelerated projects as a result of the impending expiration of 421-a.
“Brooklyn continues to be a strong anchor in the New York investment sales market with solid dollar volume across all asset types,” said Ofer Cohen, founder and CEO of TerraCRG. “$5 billion of trades in a 6-month period, for two consecutive 6-month periods is a big deal and was last seen in 2015.”
The full Brooklyn Market Report for H1 2022 is available here.