April 22, 2026
Brooklyn's commercial real estate market in 2025 was defined by two words: volume and selectivity. The borough put up serious transaction numbers while buyers got pickier. For mixed-use property owners, the picture is nuanced and worth understanding in full.
Brooklyn by the Numbers in 2025
According to Matthews Real Estate Investment Services' Brooklyn H1 2025 Market Report, Brooklyn mixed-use properties generated $488 million in total dollar volume across 163 transactions in just the first half of 2025 alone. That is a significant level of activity for a market where rates remained elevated and buyer sentiment was cautious.
TerraCRG's full-year 2025 Brooklyn report, covered by Crain's New York Business, counted 1,191 commercial deals across the borough for the year, essentially in line with Brooklyn's 10-year average of roughly 1,200 deals annually. Total dollar volume for the year hit $6.6 billion. Greater Downtown Brooklyn led by dollar volume at approximately $2.2 billion, while North-Central Brooklyn, encompassing neighborhoods like Bedford-Stuyvesant, Bushwick, and Crown Heights, led by number of transactions at 259.
The Free Market Premium Is Real
The single most important data point for mixed-use owners in Brooklyn right now comes from the Matthews report. Buildings with six or more residential units that fall under rent regulation are trading at a 40% discount on a price-per-foot basis compared to free-market buildings. Matthews noted that free market assets are trading at nearly double the price per foot of comparable regulated buildings, and cap rates on regulated assets have drifted back toward levels not seen since 2010. If you own a free-market mixed-use building in Brooklyn, that separation in value is working in your favor.
Rezoning Activity Is Creating Real Tailwinds
Three major planning decisions are reshaping Brooklyn's mixed-use landscape in ways that will affect property values through 2026 and beyond.
The Atlantic Avenue Mixed-Use Plan received City Council approval in May 2025, enabling approximately 4,600 apartments and 800,000 square feet of commercial space along a 21-block stretch from Vanderbilt Avenue to Nostrand Avenue, affecting Crown Heights, Prospect Heights, and Bedford-Stuyvesant. The Adams administration committed $235 million in public investments to the corridor, including $135 million for a redesign of Atlantic Avenue itself. For mixed-use owners within or adjacent to this corridor, the value trajectory is pointing up.
The Gowanus rezoning, covering 82 blocks, permits up to 9,000 residential units and over 650,000 square feet of commercial and retail space, and implementation accelerated sharply in 2025. Gowanus is transitioning from a niche industrial submarket into Brooklyn's largest mixed-use development zone.
Williamsburg remains the benchmark. GREA's Brooklyn mid-year 2025 report noted that Williamsburg finished the first half of 2025 with 45 transactions totaling $472 million, first in the borough by both metrics. North 6th Street hit a new peak average asking rent of $275 per square foot, with international luxury brands using the corridor to test product launches.
What Changed From 2024 to 2025
The average deal size in Brooklyn shrank significantly. Matthews reported an average deal size of $4.1 million in H1 2025, compared to an average closer to $7 million from 2022 through 2024. The market did not weaken so much as it became more granular. Smaller, cleaner assets transacted. Large or complicated deals required more patience.
Buyer composition also shifted. The Matthews report showed that 80% of development transactions in H1 2025 were user-buyers, with 50% of those being first-time buyers. Owner-occupants are stepping up where institutional capital has pulled back on smaller deals.
The 2026 Outlook for Brooklyn Mixed-Use
The Brooklyn residential median sale price closed 2025 at $998,000, essentially flat year over year, while the median price per square foot rose 6.4% to $1,019 — a sign that buyers are paying more per square foot even as transaction counts moderated. For mixed-use owners, the residential component of your building continues to hold value.
CityRealty's panel of NYC real estate experts largely expects the 2026 Brooklyn market to favor well-priced listings while overpriced properties sit longer. The consensus is not a crash but a refinement. For sellers, accurate pricing tied to real comps is more important in 2026 than at any point in the last four years.
Disclaimer: This content is meant for informational purposes only and is not intended to be construed as financial, tax, legal, or insurance advice.
