NEW YORK, NY – July 14, 2025 – Following a strong 2024, Brooklyn recorded 453 investment sales totaling $3.25 billion in 1H 2025, a modest 4% uptick in transaction volume and slight 2% decline in dollar volume compared to 1H 2024, according to Ariel Property Advisors’ Brooklyn 2025 Mid-Year Commercial Real Estate Trends report.

"Despite macroeconomic headwinds creating a sense of caution, the Brooklyn market demonstrated remarkable resilience in the first half of the year,” said Ariel Partner Sean R. Kelly, Esq. “Development land values hit an all-time high at $313/BSF, fueled by pro-housing initiatives like City of Yes, and signaling robust confidence in Brooklyn's long-term growth and development pipeline."

Ariel Director Steve Vorvolakos added, "Brooklyn's multifamily market was a clear bright spot in the first six months of the year, with transaction volume up 10% and dollar volume climbing 14% to over $2 billion. In this environment, we're seeing a strategic pivot from investors who are heavily targeting smaller, free-market buildings to sidestep rent regulations."

Associate Director Nicole Daniggelis continued, "The first half of 2025 revealed two very different stories in Brooklyn's commercial sector. While the industrial market tapped the brakes after a post-COVID boom, the retail sector hit its stride. A 16% surge in retail sales, driven by major institutional investments in prime locations like Williamsburg, proves that demand for high-quality, well-located retail space is stronger than ever."

Multifamily Highlights

      • Brooklyn’s multifamily market finished 1H 2025 with 282 transactions totaling just over $2 billion in dollar volume, marking 10% and 14% increases from 1H 2024.
      • Of the 282 transactions throughout 1H25, 51.45% were for buildings with fewer than 6 units, underscoring a consistent post-HSTPA (Housing Stability and Tenant Protection Act of 2019) investment strategy of prioritizing smaller, tax class protected assets that primarily offer free-market, value-add opportunities, largely unburdened by rent stabilization regulations.
      • A significant transaction was the sale of 395 Leonard Street for $127.5 million, or $683/SF.

Development

      • Development dollar volume rose 5% year-over-year to $610 million in 1H 2025, while transactions were flat at 68.
      • Much of the transaction volume was fueled by state and local initiatives including the 485X tax abatement and rezonings designed to address the housing shortage, which pushed pricing to an average $313/BSF.
      • Williamsburg continued to be the leader in the borough, finishing 1H 2025 with 10 sales for $72 million with most sites slated for smaller condo projects.
      • Condo pricing edged up from $1,263 to $1,300 per square foot with developers seeing the average days on market down from 91 to 70.
      • A significant transaction was Charney Companies and Tavros Capital Partners’ acquisition of 175 3rd Street for $164 million, or $234/BSF.

Industrial

      • After a strong post-COVID run that saw the industrial and warehouse asset class surge in Brooklyn, there was a bit of a slowdown during 1H 2025.
      • In total, there were 46 transactions totaling $241 million, which represent 21% and 51% decreases respectively compared to 1H 2024.
      • Industrial vacancy throughout NYC increased to 10.2% by the end of Q1 2025, the highest in over a decade according to a report from CRE Daily.
      • East New York led Brooklyn with 7 industrial transactions in 2025, including the Carlyle Group’s $50 million purchase of 1 Remsen Avenue, a self-storage warehouse which is the largest transaction of the year so far.

Retail

      • After a strong 2024, Brooklyn’s retail market continued its upward trajectory. Despite a slight decline in transaction volume (31 in 1H 2025 vs. 37 in 1H 2024), dollar volume rose, finishing 1H 2025 with $188 million in sales, a 16% increase compared to $162 million during 1H 2024.
      • The average retail price ended 1H 2025 at $762 per square foot, which is a pace that would significantly surpass Brooklyn’s previous record of $721 per square foot set in 2024.
      • Although only 5 of the 31 transactions sold for less than $5 million, institutional investors remained a key force in the market, as exemplified by City Urban Realty’s sale of 95-97 & 107 N 6th Street to Acadia Realty Trust for $60 million.

Ariel Property Advisors’ Brooklyn 2025 Mid-Year Commercial Real Estate Trends report is available here.