The new Brooklyn may be the destination of choice for many, but its market appeal lags behind the draw of Manhattan when it comes to luxury rentals. Despite the array of new, glass towers and brick, industrial-style buildings loaded with amenities, rents were 16% below Manhattan levels in Williamsburg and 20% lower in downtown Brooklyn. That was a key finding in a new report by property manager FirstService Residential , comparing rental buildings with amenities developed since 2000 in Manhattan, Brooklyn and Queens. “Manhattan is still Manhattan, and the best areas of Manhattan will command higher rents,” said Gary Jacob, executive vice president of Glenwood Management, which has built some of the most expensive rentals in Manhattan. More:One-Fifth of Manhattan, Brooklyn Properties Are Luxury Listings The report ranked the Grand Tier, a 30-story Glenwood building on Broadway near Lincoln Center, as the city’s most expensive building. Asking rents averaged $9,214 a month, according to Streeteasy.com. All of the top 10 buildings in terms of rent were in Manhattan—either downtown, in Chelsea or on the Upper West Side. Coming in second was the Corner, on West 72nd Street and Broadway, by the Gotham Organization. Another Glenwood building, Hawthorn Park on West 62nd Street and Amsterdam, ranked third. New rentals in the Queens neighborhood of Long Island City lagged behind even further. Average studio rents were 23.8% below Manhattan, while two-bedroom rentals were 31.5% lower.
Rents in the studio market are the most competitive with the highest price a square foot of any rentals, said Robert Scaglion, executive managing director at FirstService Residential New York. For the same price, “a studio renter in Manhattan may be able to get a one bedroom in Brooklyn,” he said. For all types of buildings, the rent gap between Brooklyn and Manhattan apartments is smaller. It fell from more than 30% in early 2008 to about 12% during the past 12 months, according to data from appraisal firm Miller Samuel Inc. and the brokerage Douglas Elliman. The FirstService study compared average listed rents per- square foot for a group of 178 buildings built or converted to residential use since 2000. These buildings had amenities such as gyms and swimming pools and rents of at least $50 a square foot, or about $2,600 for a studio, in neighborhoods “generally regarded as desirable or ‘high-end,’ ” the report says. The typical luxury one-bedroom rental in Manhattan went for $4,286 a month, compared with $3,533 in Williamsburg and $3,350 in downtown Brooklyn, according to the study. Among the top 10 buildings, a similar apartment rented for $5,618 a month. For some renters, the choice between Manhattan and Brooklyn comes down to a comparison of new, full-service buildings in Brooklyn versus older, less glamorous buildings in Manhattan. Alex O’Connor, 25 years old, lived on Manhattan’s West Side when he first came to New York City after college. But he soon found that he was spending a lot of time with friends who lived in Williamsburg and moved there.
Earlier this year, Mr. O’Connor, who works for a real-estate investment trust based in Manhattan, was ready to “get my own place,” he said, after living with two roommates. With his partner, Johnny Picardo, who works in fashion, Mr. O’Connor looked at Manhattan again but moved into a one-bedroom apartment on the seventh floor of One North Fourth, a new 41-story tower at 1 N. Fourth St. on Williamsburg’s waterfront. His monthly rent: $3,300. The skyscraper, with an outdoor plaza and swimming pool, opened about eight months ago and has tenants for about two-thirds of its 510 units, said Jeffrey E. Levine, the chairman of Douglaston Development, which built the tower. Many of the renters, he said, are millennials attracted to the building’s many amenities and social activities. Another Douglaston project, the Ohm in West Chelsea that opened in 2010, commands higher rents, he said. With the price of land so high in Manhattan, Mr. Levine said he expected few new rental buildings to be built in the years ahead, which should keep the pressure on rents. As for Mr. O’Connor, one of the prime features of his seventh-floor apartment is the view—of the Manhattan skyline. Write to Josh Barbanel at josh.barbanel@wsj.com This article originally appeared on The Wall Street Journal.