Amazon eyeing Sunset Park’s Industry City

BY JEFFERY HARRELL AND NED BERKE

Amazon is reportedly in search of a Brooklyn location and is considering Sunset Park’s Industry City, after pulling out from its bid for a Queens headquarters amid intense political criticism earlier this year.

The online retailer is evaluating potential Brooklyn locations for a logistics facility (not the same thing as the “HQ2” that had been planned for Long Island City), from which it could rapidly deliver orders to customers, Crain’s reported. Industry City’s 5.27 million-square-foot campus has waterfront access and sits in the shadow of the Brooklyn-Queens Expressway.

A spokesperson for Amazon told the Brooklyn Eagle that there is no deal with Industry City, but that Amazon is constantly evaluating new real estate opportunities.

A spokesperson for Industry City would not comment on any potential deal, but pointed toward the demand for facilities of the kind Amazon would need.

“While it’s clear that a number of entities are looking to satisfy their ‘last mile’ needs in Brooklyn, we decline to comment on any specific negotiations Industry City might be having,” spokesperson Lisa Serbaniewicz told the Eagle.

The news comes as Industry City’s owners — a partnership of investors including Jameston, Belvedere Capital and Angelo Gordon — are applying for a controversial rezoning that would reshape the 35-acre property from a largely manufacturing and storage center into an “Innovation Economy Hub” as part of a 10-year, $1 billion redevelopment.

Key to the vision of the innovation hub is to swap low job-producing uses for those with higher levels of employment. Under the rezoning, warehouse space at Industry City would be hemmed away in favor of light manufacturing, creative and small business uses supported by retail, academic and hotel space.

The redevelopment plan would reduce the property’s current 1.7 million square feet of storage space, and eliminate 679,960 square feet of vacant space — much of which is in need of serious repairs.

An Amazon deal could present a challenge to their purported vision, as it would be a large, long-term deal in low-job warehousing.

Industry City officials would not speculate on the impact of a large tenant like Amazon, but said their current plans are to pursue their rezoning.

“Our plans for ULURP have not changed,” Serbaniewicz said, referring to the rezoning process.  She noted, however, that signing Amazon on a tenant would not require outside approval from the City Council or input from local stakeholders. “This kind of deal can be done as-of-right.”

Industry City put a hold on the rezoning process in March, bowing to community opposition and granting a six-month delay before the rezoning could be approved. The complex is expected to restart the process this fall.

Industry City was initially pitched to Amazon during its nationwide search for a 4 million-square-foot “HQ2,” which was set to be located in Long Island City before progressive backlash caused the e-commerce behemoth to balk at the deal.

Crain’s notes that Amazon could also find space nearby, where the city’s Economic Development Corporation is looking for a developer to construct a distribution facility at Brooklyn Army Terminal’s parking lot. The publication said it was “unclear” if it was under consideration.

Other Brooklyn locations were also on Amazon’s radar during their search for a headquarters destination, including the Panorama complex (formerly the Watchtower headquarters) at the edge of DUMBO and Fulton Ferry, and Dock 72 at the Brooklyn Navy Yard.

Amazon has recently expanded facilities in the Bronx and Staten Island, according to Crain’s, but has yet established a foothold in the city’s most populous borough.

Update (6:26 p.m.): Brownstoner’s Cate Corcoran notes that Amazon already has space next door, at Salmar Properties’ Liberty View Industrial Plaza. The e-retailer signed a five-year lease for 1 million square feet in 2015, and Corcoran suggests the leak could be a negotiation tactic.

“Their lease is up in two years, so letting it be known they’re looking around could help them negotiate better lease terms, or they could be looking for more space,” Corcoran writes.

Correction (6:26 p.m.): The original version of this article stated Amazon had no Brooklyn presence. As Brownstoner points out, that was incorrect. The article as been updated, and we regret the error.