A Lot of People Would Pay a Million Dollars to Live in DUMBO

Boerum Hill Will Probably Catch Up Soon

By Dennis Holt

According to PropertyShark.com as reported by The Real Deal blog, DUMBO and Boerum Hill have joined the top 10 most expensive neighborhoods in the city.

The two most expensive areas in the city are Soho and Tribeca, but DUMBO moved into fourth place of the top 10 and Boerum Hill made the number 10 spot.

In the second quarter of this year, the median sales price in DUMBO was $1.075 million. Boerum Hill’s median sales price was $801,000.

Boerum Hill is edging higher on such lists, not just because of its convenient location and its quality stock of brownstone houses, but also because what used to be empty lots are filling up with market rate apartment buildings.

And as the quality of Downtown Brooklyn retail shopping continues to improve, Boerum Hill, abutting Downtown, will grow its appeal.

The DUMBO story, told many times, drew this comment on the Real Deal blog:

“DUMBO may continue to climb up that list as the Brooklyn Bridge Park nears completion, not to mention its blossoming digital district that attracts the tech savvy from all over the nation. … Brooklyn ain’t no bubble.”

In a totally different report, Marcus & Millichap Real Estate Investment Services provided an analysis of apartment rental rates in Brooklyn and throughout the city with this compelling conclusion: “Demand for large market-rate apartments surged so far this year to levels last seen over a decade ago.”

The report noted that about 1,925 multifamily permits were issued in Brooklyn in the last four quarters, a nearly 200 percent increase from the previous period. And, more than 1,000 large market-rate units will open their doors in Brooklyn in 2011.

The demand led owners to hike asking rents 9.3 percent to $1,535 per month during the past 12 months.

Investors looking to acquire apartment buildings or to have them built began to look more earnestly at Brooklyn during the last 12 months. Such activity increased 20 percent during the past four quarters.
The prediction by Marcus & Millichap is that asking rents will reach historical highs in Brooklyn in 2011 as operators increase asking rents 6.1 percent to $1,576 per month.

As has been previously reported, many of the market-rate units in Brooklyn were originally built as condos and contain amenities seldom found in rental apartments. This contributes to high rents.

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Filed under Boerum Hill, DUMBO, Real Estate

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