225 Avenue M Development Comps & Neighborhood
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225 AVENUE M DEVELOPMENT COMPS & NEIGHBORHOOD Transaction Overview The 225 Avenue M development project possesses a strong location in the midst of the largest religious communities in New York City. Expensive houses stand shoulder to shoulder, each with manicured lawn and hedges, luxury cars parked out front and designs like Mission-style archways, porches with columns and terra-cotta roof tiles. The massive homes are owned by the large and still-growing Sephardic community from Syria, Lebanon and elsewhere in the Middle East. A few minutes away, in Brighton Beach, resides the largest Russian community. Demographics and Economics Brooklyn has been rapidly changing and growing over the past several years as new businesses and residents have flocked to the borough, largely from Manhattan. As of May 2014, the number of businesses in Brooklyn had grown 21 percent over 2003. Job growth has outpaced that of New York City, at 19.8 percent. Nearly half the jobs in Brooklyn are within the health care and retail industries. Professional and business services are experiencing rapid growth, manufacturing is recovering, and there is an increasing presence from technology and creative firms. Private sector wages in Brooklyn totaled $18.7 billion in 2012, which is the highest amount on record, and represents a 42 percent increase over 2003. The average private sector salary for jobs in Brooklyn was $38,550 in 2012, which is the lowest out of all the boroughs. This can be attributed to the fact that Brooklyn has a high concentration of lower paying industries. Brooklyn’s median household income in 2012 was $45,230, while the citywide median was $50,900. Household income in Brooklyn is improving, though, having experienced 5.8 percent in 2012, which is twice as fast at the citywide growth rate. Brooklyn experienced a faster growth rate for private sector employment than any other borough between 2003 and 2012, during which time it increased by 19.8 percent, while the rest of the city increased by an average 10.6 percent. Brooklyn had a total of 484,560 private sector jobs in 2012, and in the third quarter of 2013 the rate of job growth increased more dramatically resulting in the number of private sector jobs exceeding 500,000. The graph below depicts the percent change in private sector employment in Brooklyn and the other four boroughs between 2003 and 2013. A significant sector of employment in Brooklyn is the health care and social assistance sector, with 160,410 jobs in 2012. A recent agreement with the Federal Government will enable New York State to reinvest projected Medicaid savings to help Brooklyn hospitals that have fallen on tough times reorganize and remain open. This will help preserve hundreds of jobs that would otherwise be lost. With 64,890 jobs in 2012, retail is the second largest employment sector in Brooklyn, accounting for 13.4 percent of all private sector employment. The retail sector faced obstacles during the recession, but has since recovered, adding 8,120 jobs, 40 percent of which were in food and beverage stores. The fastest rate of growth out of any sector in Brooklyn was experienced by the leisure and hospitality sector, which expanded by 36 percent between 2008 and 2012. It is important to highlight that the rest of the city grew at twice the rate between 2008 and 2012. During that four year span, Brooklyn’s leisure and hospitality sector added 9,820 jobs, 85 percent of which can be attributed to restaurants, bars and food services. Focusing on the more immediate area that surrounds the site, Southern Brooklyn provides nearly 9 percent of all jobs in the borough. Health care accounts for approximately half of the area’s jobs, with 10 out of the 11 large employers with over 500 employees in the area being in the healthcare industry. The greater Borough Park area, which is adjacent to the subject area, is responsible for 8 percent of all jobs in Brooklyn. Sunset Park, which is an area northwest of the subject, accounts for approximately 8 percent of all jobs in Brooklyn. This area is a major manufacturing center, with three key clusters of activity. Industry City is New York’s largest privately held shipping and manufacturing center with 6 million square feet in 16 various buildings on 30 acres. The property is working on attracting manufacturers of food, clothing and technology. A 50,000 square foot factory was added to the property in 2013 by MakerBot, a manufacturer of 3-D printers. The 97 acre, city-owned Brooklyn Army Terminal has been converted from a military depot to commercial and manufacturing uses. The city is seeking to invest $100 million in the facility to create new commercial space. Adjacent to the Bay Ridge Channel is the third facility, South Brooklyn Marine. New York City Economic Development Corporation completed a $115 million renovation of the 88 acre site in 2012 to help spur maritime freight services. In 2013, the city’s first large recycling facility was completed at the facility. Demand Generators In the subject’s area of Brooklyn, Healthcare is a major industry. Companies and offices in the surrounding area include Pharmaceutical and Healthcare related businesses such as Dealmed Medical Supplies, Adwe Laboratories Inc., Universal Marine Medical, Park Surgical, Jaman Drug Co., Gaetano Disanto Pharmaceutical, Geri-Care Pharmaceuticals, R & J Pharmaceutical Inc., Metromed, Broadway Medical and PhentermineNY.com. There are a number of leading hospitals and medical centers within proximate distance of the subject area. Within a two mile radius of the proposed site are Mount Sinai Beth Israel Medical Center, Coney Island Hospital, and the New York Community Hospital of Brooklyn. In July 2013, The Mount Sinai Medical Center and Continuum Health partners combined the two entities, creating the Mouth Sinai Health System. The facility encompasses 1,784 full and part-time physicians, 3,783 voluntary physicians and 12 freestanding ambulatory surgery centers. Coney Island Hospital has enhanced their facilities with the recent renovation of the Emergency Department. In 2013, the hospital reported 310 staffed beds, 11,471 discharges, 268,075 outpatient visits and 57,269 ER visits. New York Community Hospital of Brooklyn was founded in 1929, and today serves as a 134- bed acute care hospital within the community. Other medical institutions within the nearby area include Brookdale Hospital Medical Center, Long Island College Hospital, New York Methodist Hospital, and Maimonides Medical Center. In the Fall of 2013, Touro College’s School of Health Sciences’ Department of Nursing moved into two floors of a new, modern building located at 902 Quentin Road across the street from the subject. Touro College has a significant presence in the south central region of Brooklyn. Educational facilities affiliated with Touro College that are located in Brooklyn include the Graduate School of Education, Graduate School of Social Work, Lander College of Arts and Sciences, Machon L’Parnasa/Institute for Professional Studies, New York School of Career and Applied Studies, School for Lifelong Education, School of Health Sciences- Nursing Program and Graduate School of Speech and Language Pathology. Brooklyn College and Kingsborough Community College are academic establishments located within the subject area as well. In Spring 2014, Brooklyn College had a student body of 13,276 undergraduate students and 3,187 graduate students. Brooklyn College is comprised of 13 buildings on 35 acres. Kingsborough Community College offers over 40 degree and certificate programs and has been recognized as one of the top community colleges in the United States by The New York Times. Other major educational institutions that are located outside of the immediate Midwood area include Medgar Evers College, NYU Polytechnic School of Engineering, Long Island University, SUNY Downstate Medical Center, Brooklyn Law School, Career Institute of Health and Technology. The subject area has a large immigrant and foreign born population. Many visitors come to the area to visit local residents and/or to experience their culture’s ethnic community. The subject area features an abundance of facilities reflecting cultural and ethnic ideologies and traditions, such as educational facilities, religious facilities and specialized food establishments. There is significant presence from foreign travelers from the Middle East and Asia in particular. Other demand generators within the area that appeal to leisure travelers include the famous Coney Island Cyclone, an historic wooden roller coaster that first opened in 1927. There are currently plans in place to invest a total of $5.5 million on improvements such as adding 950 feet of track and repaving the tracks over the next several years. Coney Island offers several amusement parks, with the two newest parks being Luna Park, which opened in 2010, and Scream Zone, which opened in 2011. The Coney Island Boardwalk extends 2.5 miles off of the Coney Island border from West 37th Street to Brighton Beach. Along the boardwalk, additional attractions such as the beach and the New York Aquarium can be accessed. The New York Aquarium was severely damaged by Superstorm Sandy, with estimated damages totaling nearly $65 million. Plans have been proposed for a $157 million shark exhibit, which is projected to open by 2016. Another attraction in the area is The Brooklyn Cyclones minor-league baseball team, which utilize MCU Park as their home field. The Neighborhood Neighborhood Developments 1601-1607 Kings Highway Distance: 0.4 miles to the west Source: Sheepshwadbites.com A real estate management company linked to the owner of one of the city’s leading necktie manufacturers and wholesalers has taken over a swath of Kings Highway real estate, with plans to redevelop the property into a five-story retail and office development. The building is being designed by the architectural firm of Murdock Solon.