With apartment oversupply down, Brooklyn builders feeling more optimistic (for now)

Bisnow yesterday posted After Years Of Brooklyn Apartment Oversupply, Construction Is Down And Rents Are Up and, while it should be taken with a grain of salt--it's essentially a promo for a panel next month--it surely indicates trends.

Landlords of new buildings are offering fewer concessions, and, according to Nancy Packes Data Services, the number of new market-rate Brooklyn rental units was 3,000 in 2015, rising to 6,000 in 2017, dropped to 4,600 last year, and is on track for less than 2,200 this year.

That's generally good news for developers of projects like Atlantic Yards/Pacific Park, but there are different sub-markets. Downtown Brooklyn rents are understandably higher than neighborhoods deeper in Brooklyn, and the cost of construction for buildings in Greenland Forest City Partners' project also has to encompass infrastructure.

Moreover, those moving into Atlantic Yards/Pacific Park must be mindful of continuing construction and the delay--until 2035?--in finishing the promised eight acres of open space.

In the near future

Does this mean that the two towers (B4, B15) that started this year and the two (B12, B13) planned to start next year will be opening in less saturated markets? Unclear. The article quotes Steve Kliegerman, the president of Halstead Property Development Marketing:

Data from his firm shows there are nearly 12,000 rental units in the pipeline in the borough, which Kliegerman believes will be absorbed over the next two years.

That's about 6,000 units per year, which is the same as the 2017 peak, a time of oversupply. 

Buildings like B4 (18 Sixth Ave.) and B15 (664 Pacific St.) should be opening in 2022 and 2021, respectively, which represent another mini-phase of supply, the amount of which is unclear. 

Keep in mind that other large projects like 80 Flatbush are already in the works.

Bottom line: stay tuned.