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February 5, 2004

 

Hevesi Report: Brooklyn Economy Poised for Redevelopment

Brooklyn's growing and evolving economy is poised to take advantage of development opportunities within the borough to bring new housing, jobs and tourism to areas that did not benefit from the economic boom of the 1990s, State Comptroller Alan Hevesi said in a report he released today examining the state of economic development and the overall economy in Brooklyn.

“During the recent economic slowdown in the City and national economies, Brooklyn's economy showed improvement as employment remained stable, private sector wages grew, property values surged, crime fell dramatically and the number of public assistance recipients substantially declined,” Hevesi said at a breakfast sponsored by the Brooklyn Chamber of Commerce on the Long Island University Campus. “While problems remain that need to be addressed – including a lack of affordable housing, high poverty, and an aging transportation network – recent investments made by the City, the State, and private investors have positioned the borough well for future growth.”

A number of Brooklyn projects have either been proposed, or are currently underway through the cooperative efforts of the City, the State and private developers. These projects will help revitalize several neighborhoods including Williamsburg, Greenpoint, Sunset Park, DUMBO, Red Hook and downtown Brooklyn, according to the report. Although unanswered questions remain about many of the projects, the potential they bring to provide housing, diverse industries, tourist attractions and open space is unprecedented and will go a long way toward making the borough an even more desirable destination.

“Brooklyn has many strengths and as we move forward into the 21 st century, we are positioned to be a leader in economic development and a model for all cities nationwide,” Brooklyn Borough President Marty Markowitz stated.

"The Comptroller's report confirms what those of us in Brooklyn have known for years," said Brooklyn Chamber of Commerce President Kenneth Adams. "Our borough's economy is diverse, incredibly vital and is poised to help lead a citywide economic recovery. It's easy to see why so many people are bullish on Brooklyn."

Brooklyn experienced only moderate growth during the economic boom of the 1990s because most of its jobs were local in nature, mostly in health, retail trade and service industries. But that is also what cushioned it during the national recession following the technology bust in 2000 and the 9/11 terror attacks.

The report details the evolution of the Brooklyn economy. Notable findings include:

  • In Manhattan, over half the jobs created during the 1990s were lost between 2000 and 2002; while in Queens one fifth of the new jobs were lost. In Brooklyn, employment declined by only 0.3 percent in those years, which represented only 5 percent of the jobs gained in the 1990s.
  • Private sector wages grew by 3 percent in Brooklyn in 2002—the highest growth rate of all five boroughs—despite a national recession and the impact of September 11, 2001. From 1998 to 2002, real private sector wages (adjusted for inflation) increased in Brooklyn by 7.8 percent, the fastest rate in the City. Citywide growth was only 4.1 percent in these years.
  • The number of Brooklyn residents receiving public assistance has been declining in recent years. In FY 1994, 408,400 people in Brooklyn received public assistance. Through FY 2003, this number has declined by 66 percent to 140,600 people.
  • While this number is declining, 21.2 percent of Brooklyn households had an income equal to or below the poverty level in 2002, a rate that exceeded the Citywide rate of 18.3 percent.
  • Unemployment in Brooklyn also remains high, rising to 9.3 percent in the first 11 months of 2003 (second only to the Bronx), compared to a Citywide average of 8.6 percent.
  • Property values in Brooklyn have surged. Among the outer boroughs, Brooklyn's average home value of $367,000 is the highest. Values for FY 2004 show an increase from the previous year of 13.5 percent—growing slightly faster than the Citywide average
  • Between 1993 and 2002, every type of major crime decreased in Brooklyn. Reported crimes fell by over 63 percent and murders fell by 69 percent.

Thanks to that stability and a changing economy, Brooklyn has become attractive to developers and several major initiatives are either planned or underway, including more residential housing, retail development, redevelopment of the Brooklyn waterfront and new commercial enterprises. Many of these efforts are being undertaken in partnership with Brooklyn-based economic development entities, such as the Brooklyn Chamber of Commerce and the Brooklyn Economic Development Corporation.

A list of these projects would include:

  • Ikea, an international furniture retail chain, has proposed building a 300,000 square-foot store on 22 acres of waterfront in Red Hook. The project is expected to create 500-600 permanent jobs and a 5.5-mile waterfront esplanade.
  • The New York Marriott at Brooklyn Bridge in downtown Brooklyn has announced plans to add 8,000 square-feet of retail space with 3,400 additional square-feet of meeting space and 282 new guest rooms. This would make it one of the largest hotels in the City.
  • A new flagship park is being built along a 1.3 mile stretch of the Brooklyn waterfront, stretching from the Brooklyn Navy Yard to Atlantic Avenue. Brooklyn Bridge Park will include a state-of-the-art hotel and conference center as well as a recreation center and shopping mall. At least 80 percent of the park will remain free of commercial development.

The Comptroller's report also discusses development opportunities for downtown Brooklyn, which continues to benefit from a revitalization effort over the last decade. The central business district now boasts 11 million square-feet of office space where 70,000 people are employed by such firms as Bank of New York, Bear Stearns, Empire Blue Cross and Blue Shield, KeySpan and Morgan Stanley. The Department of City Planning has issued an ambitious rezoning proposal for the area in an attempt to transform downtown Brooklyn into a thriving “24/7” community. Other projects discussed include the opening of Steiner Movie Studios in the Brooklyn Navy Yard and SUNY Downstate's biotechnology incubator.

“Though Brooklyn faces many challenges in the years ahead,” Hevesi said, “efforts are underway throughout the borough to capitalize on gains made over the past few years and to set the stage for future economic growth.”

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Click here for a copy of the Comptroller's report.

 

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