Brooklyn’s Office Market Is Buzzing! Here’s What Q1 2025 Looked Like
Hey Brooklyn businesses! If you’ve been wondering about the office market, get ready for some good news. Q1 2025 just wrapped up, and it was a powerhouse for Brooklyn office leasing – actually, the strongest we’ve seen since Q1 2020! We’re talking 509,000 square feet of new leases and expansions, which is a massive 83% jump from last quarter and way, way up (136%!) from our usual five-year average. This isn’t a fluke either; it’s the second quarter in a row we’ve blown past that five-year benchmark.
What’s driving all this activity? Big deals! We saw five leases over 30,000 sq. ft. in just this one quarter, matching the total for all of 2024. And get this: the average deal size was 31,000 sq. ft., a huge leap from the 19,000 sq. ft. average we saw from 2021-2004. So, bigger spaces are moving, and that’s a great sign.
Where’s the Action Happening?
- DUMBO stole the show this quarter, with 203,000 sq. ft. in leases – its best quarter since way back in Q1 2017! Huge shout-outs to Gersh Academy (58,000 sq. ft. at 25 Chapel Street) and a confidential consulting company (42,000 sq. ft. at 55 Water Street) for those significant commitments.
- Downtown Brooklyn was right behind with 175,000 sq. ft. of leasing. This means an 87% increase from last quarter! A major player here was Brooklyn Prospect Charter School with a whopping 151,000 sq. ft. lease at 181 Livingston Street. It’s clear that education tenants are still a huge part of Brooklyn’s office scene, making up 20% of our leasing activity over the last three years.
- Even the Brooklyn Navy Yards got in on the action, recording 75,000 sq. ft. in Q1. That’s a massive jump from last quarter and 242% above their five-year average! Most of that was thanks to Lafayette 148, who grabbed 70,000 sq. ft. at 141 Flushing – Building #77.
What About Vacancy and Rents?
While leasing was strong, we did see some negative absorption (322,000 sq. ft.) this quarter, which means the availability rate nudged up to 20.8%. Downtown Brooklyn and Williamsburg/Greenpoint saw some space come back to the market.
However, DUMBO actually saw positive absorption (91,000 sq. ft.), and its availability rate dropped! This was partly because a lot of sublease space was taken off the market. The Navy Yards also had positive absorption (66,000 sq. ft.) and saw its availability rate decrease thanks to that big Lafayette 148 deal.
As for rents, Brooklyn’s average asking rent is hovering around $54.08 per sq. ft., pretty stable from a year ago. Most areas didn’t see much change, but Downtown Brooklyn’s average dipped a bit as that large Brooklyn Prospect Charter School space, which had higher asking rents, was leased up.
What’s Next for Brooklyn Office Space?
Good news for those looking for brand new space: we have two new projects set to be completed in 2025! Keep an eye out for 1 Wythe Avenue (102,000 sq. ft.) and 121 Morgan Avenue (58,000 sq. ft.), both expected to be ready for tenants in Q2 or Q3. Exciting times ahead for Brooklyn’s office market!
For more detailed information on Brooklyn or any other market in NYC please feel free to reach out.
Paul Walker 212-984-7117
A commercial real estate broker specializing in all facets of office leasing for over 30 years, I’m also a proud native New Yorker with a deep love for this city. My commitment to my community is reflected in my founding of two real estate charity events and consistent involvement in professional organizations. Outside of work, I enjoy live music, movies, basketball, tennis, podcasts, and a continuous pursuit of knowledge, especially regarding history and the fascinating story of New York.