Sperry Van Ness International Corporation’s (SVNIC) 2015 Market Update Reports assess the current state of the national commercial real estate market, and identify micro-trends within specific geographic regions and industries for 2015. Today we are delving into the 2015 Top Office Markets to Watch. Not the largest or the most actively contested markets, the 2015 Office Markets to Watch are each at an important juncture that presents unique opportunities for investment. Together, they reflect the diversity of trends that is driving the economy and commercial real estate performance in markets across the country.

Top Office Market to Watch: Brooklyn, NY

Brooklyn: 2015 Office Markets to WatchA large swathe of Downtown Brooklyn was rezoned in 2004 with the intention of transforming the neighborhood into a back-office haven rivaling that of Jersey City. Over the following decade, developers instead jumped at the chance to reposition defunct industrial space as new luxury condominium offerings. More recently, the burgeoning tech sector has fueled demand for flexible office space with less traditional formats. The structured suit-and-tie regimes of Manhattan’s Midtown office submarket have been ill-suited to the preferences of these prospective tenants. Capitalizing on the opportunity, building owners in and around DUMBO, Brooklyn Heights, and the Brooklyn Navy Yard have branded their area as the Brooklyn Tech Triangle. The Dumbo Heights complex (housed in the old Watchtower buildings which once served as the headquarters for the Jehovah’s Witnesses) is currently being refurbished, but already has major leases with e-commerce site Etsy, and co-working front-runner WeWork. The Brooklyn Navy Yard houses manufacturers of parachutes and bullet-proof vests, but now increasingly is attracting architectural and design firms for use of its office space. The downtown Brooklyn office vacancy currently sits at less than 4% with TAMI tenants (technology, advertising, media and information) clamoring for more space. Developers are looking to other neighborhoods in order to service the demand, and are making bets on offices in Fort Greene, near Pacific Park (formerly Atlantic Yards), and industrial space in Sunset Park as the next hopeful TAMI magnets.

To read more on Brooklyn and other top office markets, download the full version of the 2015 Office Market Update report here.

2015 Office Market Outlook

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