Driving around Williamsburg with David Maundrell, it was easy, if only for a moment, to forget about the recession. A 34-year-old with jet-black hair, a fuzzy goatee, and a thick Brooklyn accent, Maundrell is the president of Aptsandlofts.com, a brokerage he founded in 2002 that was among the first to specialize in the neighborhood’s high-end housing stock. The past few years have been some extraordinarily good ones for him. No other neighborhood in the city has been more visibly transformed by new residential construction than Williamsburg, where countless glass-and-steel structures have gone up on blocks long defined by abandoned factories, trash-strewn lots, modest row houses, and (more recently) residents of the nebulously creative postgraduate variety. Maundrell, who grew up in the area “when it was just a working-class no-man’s-land,” has been involved with the marketing of over 150 new buildings in Williamsburg—about half of them condos—and in the process has gone from working alone out of a dingy storefront to employing 45 brokers inside a sleek, loftlike headquarters that would not be out of place in late-nineties Silicon Alley. To celebrate the success of the past few years, Maundrell recently splurged on a silver Maserati Quattroporte, a shiny bullet of a car that retails in the ballpark of $120,000.
“This here is 100 percent the result of the Williamsburg condo boom,” Maundrell told me, chuckling a bit, as he revved the Maserati’s eight-cylinder, 405-horsepower engine on a recent sunny morning. As we began driving around, however, Maundrell’s nostalgia for the days when brokers like him “could practically sell out entire buildings before they even existed” darkened to a state of concern for the neighborhood. With sales across Brooklyn down a staggering 57 percent from a year ago, Williamsburg, with its high density of new construction, has taken on an ominous disposition. Walk down virtually any block and you’ll come across an amenity-laden building that sits nearly empty: relics of a moment in history that seems, increasingly, like a fever dream. Some developers with iffy financing have quietly been forced to go rental, others have lowered prices to the point where losses are inevitable, and a handful of projects, including two buildings Maundrell had been selling, have gone into foreclosure.
Most unsettling are the cases of the developers who seem to have vanished, leaving behind so many vacant lots and half-completed buildings—eighteen, to be precise, more than can be found in all of the Bronx—that large swaths of the neighborhood have come to resemble a city after an air raid. “I mean, look at that,” Maundrell said as we drove down a particularly grim block on North 9th Street that was lined on both sides by pits of mud where luxury buildings were supposed to be going up. “No signs of anyone actually building anywhere. It’s crazy. My lovely Williamsburg is filled with all these vacant sites everywhere you look.”
All over the city, overleveraged developers have seen their projects stymied by the recession, but the highly speculative nature of what’s happened in Williamsburg stands out as exceptionally dramatic and misguided—New York’s version of the collapsing exurban “boomburgs” in Florida and Arizona. Thanks to its proximity to Manhattan and trendy reputation, Williamsburg had seemed poised, by the end of the nineties, to shed its identity as a postindustrial moonscape and attract the sort of culturally current luxury buyers who were being priced out of the Manhattan market. But developers were constrained by the neighborhood’s zoning, which remained manufacturing-only.
This changed in May 2005, when the city passed a sweeping bill rezoning the area’s most desirable section—the frenetic cluster of blocks surrounding the Bedford Avenue subway station—for residential construction. While many in the neighborhood worried that the rezoning threatened to destroy Williamsburg’s raggedly chic charm, the Bloomberg administration heralded the policy as a way of “harnessing the private market” to create much-needed housing at both affordable and market rates. Developers, of course, were more than willing to be harnessed: A neighborhood that had been tantalizingly off-limits was now suddenly there for the taking.
Construction began at a phenomenal pace. In 2005 alone, there were 130 new projects in the works; since then, over a thousand proposals have been filed with the local community board—including a handful of buildings with more than 200 units apiece. As the frenzy ensued, few developers seemed to entertain the critical question of whether a neighborhood with mediocre schools and a median income of $25,892 (less than that of decidedly ungentrified Crown Heights) was fully prepared to lure hordes of young professionals willing to pay Manhattan prices. “Basically, dreams were being built upon dreams,” says Matthew Haines, the chairman of PropertyShark .com, a website founded in the neighborhood that aggregates real-estate data. “The first developers out the gate thought they might—might—be able to ask around $500 or $600 a square foot. Soon they had bid each other up to $1,000 a square foot. It was ridiculous, considering that in Manhattan you could still buy for $800, but the buyers were there, so no one was really worried about what that meant.”