TM BROOKLYN NEW DEVELOPMENT REPORT 2012 SECOND QUARTER 1
TABLE OF CONTENTS Introduction 3 Market Snapshot 4 Neighborhood Price Trends Bay Ridge 9 Bed-Stuy 10 Brooklyn Heights 11 Boerum-Cobble Hill 12 Bushwick 13 Carroll Gardens 14 Clinton Hill 15 Crown Heights 16 Downtown Brooklyn 17 DUMBO 18 Fort Greene 19 Gowanus 20 Greenpoint 21 Kensington 22 Park S lope 23 Prospect Heights 24 Prospect-Lefferts Gardens 25 Williamsburg 26 The Report Explained 27 2
INTRODUCTION MNS is proud to present the Second Quarter 2012 edition of our New Development Market Report. New Development Sales data, defined as such Arms-Length first offering transactions where the seller is considered a Sponsor, was compiled from the Automated City Register Information System (ACRIS) for sponsor sales that traded during the Second Quarter of 2012 (04/01/12 06/30/12). All data summarized is on a median basis. 3
MARKET SNAPSHOT Year-Over-Year Median up 16% Quarter-Over-Quarter Median up 8% Year-Over-Year Median Sales Price up 16% Quarter-Over-Quarter Median Sales Price up 15% Brooklyn New Development Sales Inventory up 140% from 1Q12 Neighborhood with the Highest Inventory Williamsburg (33% of all Brooklyn) Total New Development Sales Volume up 155% to $232M from $91M in 1Q12 Largest Quarterly Up-Swing: Prospect Heights : $909/SF from $834/SF Sales Price: $1.8M from $1.0M Largest Quarterly Down-Swing: Carroll Gardens : $505/SF from $680/SF Sales Price: $576K from $769K Highest New Development Sale Price: On Prospect Park 1 Grand Army Plaza #PH16S - $5,100,000 Highest New Development Sale Price per Foot: On Prospect Park 1 Grand Army Plaza #PH16N - $1,497/SF MARKET SUMMARY: The Total new development sales dollar volume in Brooklyn more than doubled this quarter which is certainly a positive sign of transaction activity, but when 45% of that dollar volume comes from just four projects (EDGE, Northside Piers, One Brooklyn Bridge Park, and On Prospect Park), what does it really say about the new development condo market of the borough? MNS digs deeper into each deal to uncover the trends. Year-over-year Brooklyn new development condominium sales price per square foot numbers are up 16%, up almost $100/SF and median sales prices are also up 16% ($621K this quarter versus $537K in 2Q11). Compared to last quarter 1Q12, Brooklyn new development price per square foot median numbers are up 15% ($690/SF from $637/SF) and median sales prices are up 8%, to $621K from $538K. 4
MARKET SNAPSHOT MARKET UP-SWINGS: For the heavy hitters in the borough: On Prospect Park is back in action, closing $19M worth of inventory this quarter, versus just $1M last quarter. Edge closed $44M worth of real estate this quarter, One Brooklyn Bridge Park closed another $20M and Northside Piers closed $18M. All four properties combined, these sales had a median price of $825K and $906/SF. The rest of the borough sits 45% below that at a median sales price of $570K and $617/SF. It was the lower end of the market that actually showed tremendous improvement from last quarter. Sales in neighborhoods like Bay Ridge at a median sale price of $439/SF and Prospect-Lefferts Gardens at $537/SF is a significant indicator of Brooklyn s resilience. Even the three quarter upward trend in Clinton Hill to a two year high of just under /SF is the result of solid sales at Isabella and Fulton Street Lofts. MARKET DOWN-SWINGS: Historically, Brooklyn Heights has been the priciest neighborhood as it is one of the most mature, beautiful and desirable neighborhoods. What we find here is a strain for inventory, and everything large and expensive has not only sold but sold quickly. So the drop in median sales price from $1.1M last quarter to $970K this quarter is not a sign of the market, but again, an indicator of lack of inventory. The same holds true for Carroll Gardens where just 2 remaining sponsor units closed at Court Street Lofts. The neighborhood s new development condo inventory typically sells close to /SF and this quarter was barely over /SF. We expect that the condo product on the market now at projects like 116 3rd Place will boost the neighborhood s numbers up once they close INVENTORY ANALYSIS: This quarter we saw some new inventory hit the city registry, such as Dumbo s Kirkman Lofts with a median sales price of,000 and East Williamsburg s ID390 with a median sales price of $389,000. Compared to last quarter where Downtown Brooklyn closed just 6 units, the neighborhood had 30 closings this quarter at a healthy $666/SF. In terms of unit mix in the borough, the make-up of inventory stayed pretty consistent with last quarter, so a steady rise of both median price and median price per foot is a clear sign of strength in the market. The neighborhoods that sold the most amount of 2Q12 new development inventory per unit size: - Williamsburg (52%) One-Bedrooms - Williamsburg (35%) Two-Bedrooms - Williamsburg (20%) Three-Bedrooms (1500+) - Williamsburg (38%) 5
MARKET SNAPSHOT 2Q12 MEDIAN BY NEIGHBORHOOD $950 $850 $750 $650 $550 $450 $350 $250 Bay Ridge Bed-Stuy Brooklyn Heights Bushwick Carroll Gardens Clinton Hill Boerum Hill-Cobble Hill Crown Heights Downtown Brooklyn DUMBO Fort Greene Gowanus Greenpoint Kensington Prospect Heights Prospect-Lefferts Gardens Park Slope Williamsburg 2Q12 MEDIAN SALES BY NEIGHBORHOOD $2,050,000 $1,850,000 $1,650,000 $1,450,000 $1,250,000 $1,050,000 $850,000 $650,000 $450,000 $250,000 Bay Ridge Bed-Stuy Brooklyn Heights Bushwick Carroll Gardens Clinton Hill Boerum Hill-Cobble Hill Crown Heights Downtown Brooklyn DUMBO Fort Greene Gowanus Greenpoint Kensington Prospect Heights Prospect-Lefferts Gardens Park Slope Williamsburg 6
MARKET SNAPSHOT % OF TOTAL NEW DEVELOPMENT SALES BOROUGH-WIDE 35% 30% 25% 20% 15% 10% 5% 0% Bay Ridge Bed-Stuy Brooklyn Heights Bushwick Carroll Gardens Clinton Hill Boerum Hill-Cobble Hill Crown Heights Downtown Brooklyn DUMBO Fort Greene Gowanus Greenpoint Kensington Prospect Heights Prospect-Lefferts Gardens Park Slope Williamsburg 2Q12 MONTHLY ABSORPTION RATE 35 30 25 20 15 10 5 0 Bay Ridge Bed-Stuy Brooklyn Heights Bushwick Carroll Gardens Clinton Hill Boerum Hill-Cobble Hill Crown Heights Downtown Brooklyn DUMBO Fort Greene Gowanus Greenpoint Kensington Prospect Heights Prospect-Lefferts Gardens Park Slope Williamsburg 7
MARKET SNAPSHOT 2Q12 UNIT MIX OF NEW DEVELOPMENT SALES 3Q11 UNIT MIX OF NEW DEVELOPMENT SALES 39% 15% 25% 21% 3 Beds BROOKLYN MANHATTAN QUARTERLY QUARTERLY TRACKING TRACKING Median $1,000,000,000,000,000,000 8
NEIGHBORHOOD TRENDS BAY RIDGE BAY RIDGE BY UNIT SIZE ($439/SF Median) $100 1500+SF % OF SALES WITHIN BAY RIDGE 33% 67% BAY RIDGE QUARTERLY TRACKING Median,000,000,000,000 $100,000 9
NEIGHBORHOOD TRENDS BED-STUY BED-STUY BY UNIT SIZE ($427/SF Median) $100 1500+SF % OF SALES WITHIN BED-STUY 37% 13% 25% 25% BED-STUY QUARTERLY TRACKING Median,000,000,000,000 10
NEIGHBORHOOD TRENDS BROOKLYN HEIGHTS BROOKLYN HEIGHTS BY UNIT SIZE ($828/SF Median) $1,000 1500+SF % OF SALES WITHIN BROOKLYN HEIGHTS 25% 46% 29% BROOKLYN HEIGHTS QUARTERLY TRACKING $1,000 Median $1,750,000 $1,500,000 $1,250,000 $1,000,000 $750,000,000 11
NEIGHBORHOOD TRENDS BOERUM-COBBLE HILL BOERUM-COBBLE HILL BY UNIT SIZE ($752/SF Median) $1,000 1500+SF % OF SALES WITHIN BOERUM-COBBLE HILL 25% 25% 25% 25% BOERUM-COBBLE HILL QUARTERLY TRACKING Median $1,400,000,000,000 12
NEIGHBORHOOD TRENDS BUSHWICK BUSHWICK BY UNIT SIZE ($431/SF Median) 1500+SF 0% % OF SALES WITHIN BUSHWICK 33% 67% BUSHWICK QUARTERLY TRACKING Median,000,000,000 $100,000 13
NEIGHBORHOOD TRENDS CARROLL GARDENS CARROLL GARDENS BY UNIT SIZE ($505/SF Median) 1500+SF % OF SALES WITHIN CARROLL GARDENS 0% 100% CARROLL GARDENS QUARTERLY TRACKING Median,000,000,000,000 14
NEIGHBORHOOD TRENDS CLINTON HILL CLINTON HILL BY UNIT SIZE ($595/SF Median) $100 1500+SF % OF SALES WITHIN CLINTON HILL 60% 40% 0% CLINTON HILL QUARTERLY TRACKING Median $950,000,000 $450,000,000 15
NEIGHBORHOOD TRENDS CROWN HEIGHTS CROWN HEIGHTS BY UNIT SIZE ($297/SF Median) 1500+SF % OF SALES WITHIN CROWN HEIGHTS 0% 67% 33% 0% CROWN HEIGHTS QUARTERLY TRACKING Median,000,000,000,000 16
NEIGHBORHOOD TRENDS DOWNTOWN BROOKLYN DOWNTOWN BROOKLYN BY UNIT SIZE ($666/SF Median) 1500+SF % OF SALES WITHIN DOWNTOWN BROOKLYN 14% 55% 17% 14% DOWNTOWN BROOKLYN QUARTERLY TRACKING Median $1,050,000,000 $550,000,000 17
NEIGHBORHOOD TRENDS DUMBO DUMBO BY UNIT SIZE ($685/SF Median) $1,000 1500+SF % OF SALES WITHIN DUMBO 63% 8% 0% 29% DUMBO QUARTERLY TRACKING Median $1,000,000,000,000,000,000 18
NEIGHBORHOOD TRENDS FORT GREENE FORT GREENE BY UNIT SIZE ($646/SF Median) 1500+SF % OF SALES WITHIN FORT GREENE 67% 33% FORT GREENE QUARTERLY TRACKING Median,000,000,000,000 19
NEIGHBORHOOD TRENDS GOWANUS GOWANUS BY UNIT SIZE ($706/SF Median) 1500+SF % OF SALES WITHIN GOWANUS 0% 50% 50% GOWANUS QUARTERLY TRACKING Median $950,000,000 $450,000,000 20
NEIGHBORHOOD TRENDS GREENPOINT GREENPOINT BY UNIT SIZE ($653/SF Median) 1500+SF 4% % OF SALES WITHIN GREENPOINT 38% 8% 50% GREENPOINT QUARTERLY TRACKING Median,000,000,000,000 21
NEIGHBORHOOD TRENDS KENSINGTON KENSINGTON BY UNIT SIZE ($365/SF Median) $100 1500+SF % OF SALES WITHIN KENSINGTON 100% KENSINGTON QUARTERLY TRACKING Median,000,000,000,000 22
NEIGHBORHOOD TRENDS PARK SLOPE PARK SLOPE BY UNIT SIZE ($605/SF Median) 1500+SF % OF SALES WITHIN PARK SLOPE 22% 39% 17% 22% PARK SLOPE QUARTERLY TRACKING Median $1,000,000,000,000,000,000 23
NEIGHBORHOOD TRENDS PROSPECT HEIGHTS PROSPECT HEIGHTS BY UNIT SIZE ($909/SF Median) $1,000 1500+SF % OF SALES WITHIN PROSPECT HEIGHTS 55% 18% 18% 9% PROSPECT HEIGHTS QUARTERLY TRACKING $1,100 $1,000 Median $2,000,000 $1,500,000 $1,000,000,000 24
NEIGHBORHOOD TRENDS PROSPECT-LEFFERTS GARDENs PROSPECT-LEFFERTS GARDENS BY UNIT SIZE ($537/SF Median) $100 1500+SF % OF SALES WITHIN PROSPECT-LEFFERTS GARDENS 0% 23% 54% 23% PROSPECT-LEFFERTS GARDENS QUARTERLY TRACKING Median,000,000,000,000,000 25
NEIGHBORHOOD TRENDS WILLIAMSBURG WILLIAMSBURG BY UNIT SIZE ($839/SF Median) $1,000 1500+SF % OF SALES WITHIN WILLIAMSBURG 21% 16% 22% 41% WILLIAMSBURG QUARTERLY TRACKING Median $1,000,000,000,000,000,000 26
THE REPORT EXPLAINED Included in this research are walk-up and elevator new development condominium buildings, as well as new conversion condominiums if the sales were applicable sponsor transactions. Excluded from the report are all cooperative sales. Unit types such as studios, one-bedrooms, and two-bedroom units are grouped by square footage ranges. are under 700 square feet, one-bedrooms are under 900 square feet, and twobedrooms are under 1,450 square feet. Added to the report is the over-sized unit type that ranges from 1,500 square feet to 5,500 square feet. Presented with a quarter-over-quarter and year-over-year comparison, both city-wide and by neighborhood, MNS New Development Report TM tracks the market trends throughout Manhattan and Brooklyn. MNS offers a unique insight into the new development market by tracking stalled construction sites on a quarterly basis, a great indicator of where development in general is moving. MNS is your source to find neighborhood price per square foot analysis, average sale prices, unit type sales trends, overall price movement, neighborhood inventory comparisons, and absorption rates. Can t find what you re looking for? Ask MNS for more information at www.mns.com. CONTACT US NOW: 212.475.9000 Note: All market data is collected and compiled by MNS marketing department. The information presented here is intended for instructive purposes only and has been gathered from sources deemed reliable, though it may be subject to errors, omissions, changes or withdrawal without notice. If you would like to republish this report on the web, please be sure to source it as the Brooklyn New Development Report with a link back to its original location (http://www.mns.com/brooklyn_new_dev_report). 27