Tech in Downtown Brooklyn ‘Inevitable,’ Despite Firms’ Reluctance

Happening or over-hyped?

Happening, or over-hyped?

To hear politicians like City Council Speaker Christine Quinn, Brooklyn Borough President Marty Markowitz, or council members Steve Levin and Letitia James tell it, Downtown Brooklyn is a critical hub of New York City’s blossoming tech industry. A vertex in the so-called “Tech Triangle,” along with Dumbo and the Brooklyn Navy Yard, the area has been (or will soon be) blessed with $100,000 in study money, a new bus line, a master plan, grant programs, a new urban engineering school and an untold number of press releases.

Now it’s just missing one thing: the tech tenants. Besides MakerBot Industries, a 3D printing firm that recently took over a whole floor at Forest City Ratner’s 1 MetroTech, and Aereo, a hi-tech service to access lo-tech over-the-air TV that took up shop at 470 Vanderbilt Avenue (which straddles the border between Fort Greene and Clinton Hill), the area has few of the start-ups that the litter Manhattan neighborhoods like Union Square, the Flatiron District and Chelsea. Never mind the larger established firms like Google and Microsoft.

So is all the hoopla simply wishful thinking? A little spillover from Dumbo or the Navy Yard rather than a nascent tech triangle?

What the neighborhood does have, as commercial real estate broker Chris Havens of aptsandlofts.com told The Observer, are the “first-wave creatives”—small design firms, architects and artists—that precede the more traditionally tech-oriented start-ups and blue chips.

It just might take a while for tech companies to follow. Not least of all because Downtown Brooklyn, despite all that hype, isn’t an ideal place to host them. At least not yet.

Mr. Havens cited a number of hurdles to tech in the ‘hood—from a lack of communications infrastructure (“there are still plenty of buildings on copper and DSL” instead of high-speed fiber connections like FiOS, Mr. Havens said) to residential conversions that are depleting the supply of commercial space. And Downtown Brooklyn also lacks a key amenity that tech companies lust after: big, old buildings.

Downtown Brooklyn never had the massive number of lofts and commercial buildings of, for example, Midtown South, but it did have a healthy stock of old industrial buildings that could have been repurposed for today’s tech tenants. Unfortunately, many of those buildings fell prey to various urban renewal schemes during the post-war decades.

“To urban planners,” Brownstoner wrote of the urban renewal scheme that yielded the likes of Cadman Plaza, “the whole area was a commercial slum, with no redeeming features.” Hundreds of buildings were razed to make way for what today is a barren, wind-swept plaza largely devoid of people, intended, in the words of Robert Moses, to be “to Brooklyn what the great cathedral and opera plazas are to European cities.”

Cadman Plaza never quite became Brooklyn’s Place de l’Opéra, but that didn’t stop the urban renewal machine. A few schemes later came MetroTech Center, which NYU-Poly president George Bugliarello intended to be Brooklyn’s answer to Silicon Valley, but which instead “became transmuted into yet another corporate office scheme,” as Susan Fainstein wrote in 1992, competing with Jersey City for back-office tenants.

Mr. Havens also cited Downtown Brooklyn landlords’ lack of sophistication as a barrier to tech growth. “These firms would rather go into a four-story elevator building” than class-A space at MetroTech, for example, but landlords often don’t have the expertise or responsiveness to deal with the needs of demanding tech tenants. “The DIY owners are not always able to deal with the DIY tenants.”

Nonetheless, he claims that the migration of tech firms to Downtown Brooklyn is “inevitable.”

“They don’t necessarily want to go there,” said Mr. Havens, who worked as director of leasing at Two Trees while they were building Dumbo into the tech hub that it is today.

But there’s nowhere else in Brooklyn to go. Dumbo only has 1.3 million square feet of office space, the size of some Manhattan skyscrapers, and it’s nearly full. Williamsburg is so hot that the minuscule amount of office space there is renting for $40-50 per square foot a year.

“The market is going to force it,” Mr. Havens said of Downtown Brooklyn’s tech turn. “In 2002, people didn’t want to go to Dumbo, either. But it’s going to happen, because it has to.”

Update: The Downtown Brooklyn Partnership sent over a list of additional tech companies with office space in Downtown Brooklyn, including Broadcastr, which has 1,200 square feet at 325 Gold Street, and Q-Sensei at the Brooklyner, a mostly residential building at 111 Lawrence Street.