What De Blasio’s Land Use Agenda Means for Brooklyn Real Estate Development

by Cozen O'Connor

Cozen O'Connor

Even with all the development of the last 20 years, Brooklyn, the most populous of New York City’s five boroughs, now approaching 2.7 million residents, continues to attract strong interest from developers, each scouring the borough to see where value can be created. Development generates demand as new residents require new retail and amenity services and increasingly new office clusters for entrepreneurs freed from the Manhattan central business districts by technology and preferring to locate closer to where their employees live. No surprise Brooklyn’s recent growth has been largely clustered along and near the East River, because of proximity to Manhattan, still the economic powerhouse, but also by a surplus of underutilized property, whether formerly industrial land and buildings whose jobs had relocated to lower cost jurisdictions or office buildings whose workers had fled to lower crime suburbs.

But these characteristics alone would not have guaranteed new development – as witnessed by the failure of many other cities to capture the new interest in urban living – without the investments and inducements provided by local government. The government is the none-too-silent partner in many development projects, inducing and deterring through the general thicket of tax and construction codes. But the government also makes more targeted decisions impacting neighborhoods as well, through zoning and infrastructure investment, particularly under a mayor like Bill DeBlasio with his focus on affordability in the face of continued dramatic population growth and literally spreading the wealth to underserved parts of the city.

The recent Brooklyn development explosion followed key city initiatives such as the creation of the MetroTech complex in the 1980s, investment in the borough's cultural institutions and Prospect Park as part of a resident retention effort in the 1990s, and the major re-zonings of Williamsburg-Greenpoint and Downtown Brooklyn in the 2000s. We've identified and mapped key current proposals that we believe will set the stage for the next stage of growth.


With the East New York zoning behind it, the Department of City Planning (DCP) is in the stakeholder engagement process for future action around the Gowanus Canal, in Bushwick, and along Atlantic Avenue, to be crafted around local concerns, such as height and density, open space, and associated infrastructure needs. In particular, affordable housing requirements for new residential development will be crafted. This painstaking review will then be turned into specific text and map amendments, and be subject to environmental review and a period of public hearings and review, culminating at the city council over the next few years.

That same approach is being applied to neighborhoods vulnerable to flooding, where protecting the local character is important, in Sheepshead Bay, Gerritsen Beach, and Canarsie.

Industrial Policy

On a parallel track, DCP is doing an in-depth study of North Brooklyn with a view to enhancing industrial development with higher density, while limiting what are considered incompatible uses, such as hotels and low job generators such as self-storage. Also affected will be other Industrial Business Zones around the borough, such as Southwest Brooklyn. An anticipated private rezoning plan for Industry City, combining office, retail, and light industrial and the mayor’s initiative to create a new Garment Center at the Brooklyn Army Terminal signal the trend of mixed developments focusing on jobs and likely to draw new residents to the nearby neighborhoods of Sunset Park and Bay Ridge.


Critical to the waterfront momentum is new transportation choices. Ferry service is already being expanded, and the BQX light rail system is being planned with a route from Red Hook to Greenpoint, connecting some of the borough’s new office centers but importantly bringing new transit options to low-income families in isolated NYCHA housing along the way.


Brooklyn is currently home to 31 historic districts, neighborhoods where new development requires approval by the Landmarks Preservation Commission. New, higher-density construction, in neighborhoods such as Prospect-Lefferts, often prompts the call to create or expand districts as a way to protect neighborhood character. While limiting opportunities within the districts, a designation often enhances the value of existing properties and channels development to adjacent areas.


With the revival of the residential development property tax incentive program formerly known as 421-a, underwriting is more certain even as developers digest the impact of affordable housing and construction wages, especially in the Williamsburg-Greenpoint area, which has both additional requirements and enhanced benefits.

While the outcome of how these policies will shape development have yet to unfold, we hope that the waypoints we've mapped help inform the path developers should take.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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