New residential projects are coming online fast and furious, but some have expressed concern
When sales launched at the Baltic in Park Slope back in 2016, the condo building had the market to itself. But then things started softening, and more nearby developments started launching sales.
By the end of 2018, there were about 1,000 condo and rental units on the market in just that one neighborhood.
To sell the remaining apartments with that new competition, the project, developed by Michael Stern’s JDS Development, had to change its strategy, said Robin Schneiderman, the director of business development at Terra Development Marketing, which oversees Halstead Property Development Marketing and Brown Harris Stevens Development Marketing, the latter of which is selling the project.
The revamped plan offered new broker incentives, including increasing commissions for buyers’ brokers to 4 percent from 3 percent, for contracts signed by Feb. 15. The brokerage also struck a partnership with Restoration Hardware, which designed a model penthouse at the project. As of press time, buyers who close on units by that same date at the building will receive a $20,000 interior design allowance.
“We are adding strategic incentives to purchasers and the brokerage community to develop a sense of urgency,†said Schneiderman, who noted that about 70 percent of the 43 units are already sold. “Unfortunately, that’s what is lacking in the condo market today.â€
That lack of urgency stems largely from the inventory piling up.
As developers have rushed into Brooklyn at an accelerated rate in the last five years — putting shovels in the ground in neighborhoods ranging the maturity spectrum — they have created a big batch of condos and rentals. And over the next three years another large wave of residential projects is slated to come online, including Two Trees’ Domino Sugar project; Greenland USA’s 810-unit rental 18 Sixth Avenue, which is part of the Pacific Park megadevelopment; RedSky Capital’s 470-unit 18 India Street in Greenpoint; and 9 DeKalb, a supertall tower with 400-plus apartments that JDS is also developing. Those projects join large developments that are already selling, like Extell Development’s 458-unit Brooklyn Point project and Tishman Speyer’s 481-unit 11 Hoyt.
While the projects coming online are targeting a broad range of prices, the amount of inventory in some pockets of the borough is creating concerns.
Some say that unloading these units is going to take longer than developers were banking on and will require more financial compromises than they expected. Jordan Sachs, CEO of Bold New York, said a previous sellout timeline of 18 months to two years may be pushed to three years now.
