Sunset Park transactions boost industrial real estate in Brooklyn

The bustling Brooklyn Army Terminal on the Sunset Park waterfront. Eagle archive photo courtesy of The Bridge

The New York City industrial real estate market outside of Manhattan showed “healthy growth” in the first quarter of 2022, according to Colliers, a global commercial real estate firm. And much of the activity in Brooklyn was centered around the Sunset Park area.

Colliers, a Toronto-based company, provides services to commercial real estate users, owners, investors and developers. It has more than 400 offices in 68 countries.

Among the “selected first quarter sales transactions,” the company chose to highlight in its report the sale of a building at 5112 Second Ave. for $85 million. The warehouse, which was acquired by a joint venture between O’Conner Capital Partners and CBRE Investment Management, was described as fully leased at the time of the sale.

The report also highlighted three industrial lease deals in Brooklyn: a lease for the New York Embroidery Company at 140 58and St. (part of Brooklyn Army Terminal); a lease for Care/Of, a healthy products company at 850 Third Ave. (the Liberty View Industrial Plaza); and Vestiaire Collective, a company dedicated to second-hand luxury and fashion goods, also at 850 Third Ave.

All of the locations mentioned above are part of the Sunset Park Industrial Zone, west of the Gowanus Highway.

5112 Second Avenue in Sunset Park, a warehouse that sold for $85 million earlier this year. Photo Google Maps

Colliers, in his report, divides what he calls the “outer borough market” into several geographic segments: Bronx, Northwest Queens, Central Queens, Northeast Queens, South Queens, North Brooklyn, South Brooklyn, and Staten Island.

Based on a map included in the report, “North Brooklyn” appears to include most of Brooklyn north of Prospect Park, with eastern neighborhoods like East New York and Starrett City added.

Of all the sectors covered in the quarterly report, Colliers said, “The North Brooklyn submarket has the highest rent for industrial space on the market at $25.78 per square foot, an increase of 13. 2% year over year.”

According to Colliers, South Brooklyn has 340 industrial buildings, with an availability rate of 10.9% and an average asking rent of $18.04 per square foot. North Brooklyn has 742 industrial buildings, with an availability rate of 4.5% and an average asking rent of $25.78 per square foot.