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August 7th, 2014 Gentrification, Inc. By Erica Berger

It is Sunday in Brooklyn, the July air oppressive. You get on the subway, heading for the depths of the borough, someplace no one you know lives—yet. Off the train, phone and maps app in hand, you walk toward the pedestrian underpass of the noisy Brooklyn-Queens Expressway, meandering through a mix of residential

buildings, bodegas, factories, and abandoned buildings. And then you find it: a huge, shady courtyard between two towering manufacturing buildings, strung with twinkling lights and tricked out with bars serving sangria, a taco stand, a dance floor, and most importantly, a DJ table. You’ve arrived at Mister Sunday, one of the best daytime dance parties in New York. A sweaty, multi-ethnic tangle of scantily clad twenty- and thirtysomethings in barely-there rompers and jorts rub shoulders and butts on the dance floor with young parents with babies on their hips and aging disco-era veterans. This throbbing, vibrant scene will play out each Sunday afternoon through the fall at a place called Industry City, a hulking 16-building industrial complex that had fallen on hard times since peaking in the mid-1900s manufacturing boom. The hundreds of people who show up each week to party at Mister Sunday are out for a good time. What the carefree fun-seekers likely do not realize is that they are also a part of a powerful real-estate developer’s plan to remake Industry City—and the Sunset Park community in which it sits—into the Next Hot Property (with rents, of course, to match).

FOLLOW THAT HIPSTER! In New York City, parties like Mister Sunday, along with upscale flea markets, artisanal food events like Smorgasburg, and art events have long signaled the coming wave of

gentrification to once-crumbling industrial backwaters like Williamsburg, Bushwick, Long Island City, Gowanus, and now, Sunset Park. A hip, young set willing to push the boundaries into once-unloved neighborhoods in search of bigger spaces, creative freedom, and ultimately cheaper rent is always part of the equation of gentrification. But so are the savvy real-estate developers who follow their every move, ready to pour accelerant on the process. Jamestown, the developer that owns a 50 percent stake in Industry City along with Belvedere Capital and Angelo Gordon, aims to create a new home base for the borough’s pickle and ice cream companies, custom denim purveyors, and other makers and modern manufacturers. And what better way to raise awareness among the very types of people it’s trying to attract than to throw a bangin’ party each week deep inside Industry City’s space, in collaboration with Industry City tenant Mister Sunday? Eamon Harkin and Justin Carter are the producers and DJ duo behind Mister Sunday, which has been going strong for more than five years. Their popular parties require huge spaces, and are very loud, so nonresidential neighborhoods or accommodating neighbors are a must. The pair realize that their stamp of approval on a new scene has the power to shift opinions about an area's desirability. "Industry City has gone from old factories with some tenants, to a hub where culture is happening, and it's starting to become a destination," says Harkin. "I think we've had a role to play in that." In the beginning, Harkin and Carter, who have a nose for neighborhoods on the verge, held Mister Sunday at a location called Gowanus Grove. Situated near the banks of the pungent Gowanus Canal, a Superfund site, it was affordable. And because no one wanted to live nearby, they were free to crank up the volume. Over the course of their tenure in Gowanus, the previously unattractive neighborhood became more and more hip, thanks in part to their parties. Then, Gowanus Grove was bought by a condo developer with plans to transform the area into a 700-unit complex. Mister Sunday was on the hunt for the next hipster-adjacent neighborhood. Industry City was on Eamon and Harkin’s radar, and they entered talks with Jamestown once it became a partial owner and brought on Andrew Kimball, the previous CEO of the Brooklyn Navy Yards, to manage it. "There was a great synergy there, in that we knew we could add value in terms of bringing people down and activating the space; obviously (Jamestown and Kimball) are bringing tenants in predominantly manufacturing, but also tenants that bring life to a space," says

Harkin. "They saw we could a bring family-friendly, harmonious experience on a Sunday that could be a benefit to the local community."

THE CHELSEA MARKET METHOD Kimball makes no bones that he’s leveraging artists and their events to create a savvy buzz around the development in a way that no printed marketing material or ad buys ever could. "Part of the revitalization of the property is focused on making it more accessible to the public," he says. "With events like Mister Sunday and Rooftop Films, what was once underutilized outdoor space has become a vibrant weekend destination for people across the city." Kimball is also banking that a 40,000-square-foot ground-floor retail market for the local food makers like Blue Marble Ice Cream and Colson Patisserie that rent commercial kitchens upstairs will attract new people to the area. It’s a blueprint that has been employed to profitable effect elsewhere in the city, namely at Chelsea Market. Jamestown’s flagship property is home to fine food producers, as well as retail shops and office space for the likes of The Food Network and Google. The building’s redevelopment kick-started the transformation of Chelsea from a smelly, shady meatpacking district to one of the trendiest, and expensive, neighborhoods in the city.

The formula worked again in Queens at the Jamestown-owned Falchi building, across the tracks from the already gentrified Long Island City. Falchi, which has partnered with art collective Chashama to curate empty spaces in the transitioning building, is the new home for manufacturing headquarters of L’arte del Gelato and Juice Press, among others. A Park Slope resident and native New Yorker, Kimball spent the last decade remaking the Brooklyn Navy Yard, which now houses the largest film set and studio outside of Los Angeles, Steiner Studios, as well as tech incubator New Lab. Kimball says he intends to foster an innovation economy, "the physical, digital, and engineered products, being driven by this creative class who wants to make things again." Fortuitously, he has space that appeals to them. "This new class of innovators and makers want to work in cool, old buildings with good bones and character, the vast majority which have been underutilized for decades," he says. With gentrification comes fallout, and some Industry City tenants say that already, they are priced out. Kimball insists that the tenants he’s bringing in will provide jobs that pay well, improving the quality of life for Sunset Park residents who will ostensibly be hired. Kimball anticipates that tenants in the 6 million square feet of space will increase from 2,400 to 15,000 by 2023. Michael Allen, director of the Preservation Research Office, a historic preservation consultancy based in St. Louis, works with developers and city governments on individual buildings and district-wide projects. Allen says Jamestown's tactic of revitalizing dilapidated industrial buildings is very common in areas the buildings are proximate to residential and commercial districts that are becoming revitalized. And while gentrification sometimes has negative connotations, this is one of the less disruptive ways to rebuild neighborhoods. "One of the best things about adaptive reuse of industrial areas and buildings is that residents are barely affected. Generally, these dilapidated buildings have a low population of tenants and aren't in directly residential neighborhoods, so they bring new residents," says Allen. "At the end of the day, real estate is not workforce redevelopment. It's not the answer nor the cause of social problems. But buildings can be catalysts for economic development."

PICKLE IT AND THEY WILL COME You can’t talk about the changing landscape of Brooklyn without talking to Jonathan Butler, founding editor of Brownstoner.com and cofounder of markets Brooklyn Flea and Smorgasburg. Butler, along with partner Eric Demby, independently launched the first Flea in Fort Greene in 2008, subsequently expanding to Dumbo and Williamsburg; on its first day, it reportedly drew 20,000 people. Due to its success, Demby and Butler were approached by the owners of a condo development in Williamsburg to open a market on their lot. And thus Smorgasburg, now one of the borough’s most popular food events, was born. Butler is now focusing his efforts on a recently completed beer and food hall and a 150,000-foot office-conversion space at 1000 Dean Street in the rapidly changing neighborhood of Crown Heights. This time, he’s not going solo. Butler and BFC partners, the real-estate developer behind downtown Brooklyn’s luxury Toren building, purchased the locations for $11 million, and Goldman Sachs invested a reported $25 million in the project.

"Brooklyn’s obviously very different than when we started; it’s a little less pioneering than in the beginning days," he says. "From a creative standpoint, it’s a greater challenge now because of the high demand for space." As the tech-driven real-estate boom in San Francisco has proven—Newsweek called it "ruthless gentrification"—this can be a tricky dance. Move too fast and you alienate residents and change the fabric of the neighborhood, something many say happened in the Brooklyn's Williamsburg. But move too slow and your big investment may be at risk of stalling out. "Gentrification and succession is not rapid in many American cities," says Allen. "St. Louis, Pittsburgh, Cleveland—all of them have declining populations. Geographic inversion, when suburbanites move to the core, is still happening. But growth isn't happening quickly enough." At Industry City, Jamestown is trying to balance rapid change with community needs. Sunset Park Community Board District Manager Jeremy Laufer says the board conducted a 15-year study that called for reinvigorating the manufacturing zone west of Third Avenue (where Industry City sits, and away from the residential area of Sunset Park). "It also gave the community a say in future development," says Laufer. "It is very gratifying to hear agencies and developers reference our plan when discussing development plans."

A NEW WAVE As for Mister Sunday, the duo is cognizant of the whiplash that can occur when a neighborhood changes too drastically. "It is really important that that waterfront stays industrial; there are the concerns of Williamsburg, where the neighborhood changed overnight," says Harkin. "It’s exciting, and the local community is very supportive." Industry City's effect on the direction of the rest of the neighborhood is already apparent. A short walk away, you'll find a relatively new addition to the neighborhood's traditionally Mexican-focused culinary landscape in Cafe Zona Sur, an American/French/Mexican fusion restaurant serving $6 bottles of Aqua Panna, La Colombe coffee, and croissants made daily by Industry City tenant Colson Patisserie. Yelpers approve: "Cute, trendy, cozy, and located in Sunset Park, if this isn't a sign of gentrification, I don't know what is!" "This is the kind of place you'd see in Park Slope or East Village." Cafe Zona Sur chef and owner Jose Luis Hernandez is a Sunset Park resident who until recently worked in Manhattan restaurants like Morandi and Warren 77. "I've lived here

since the 1990s; it used to be really bad," Hernandez says. "But I started noticing a new wave of customers at the Mexican restaurants in the neighborhood and decided to open a restaurant of my own. Sunset Park is changing a lot. It's where a lot of people want to be now." The Mister Sunday duo is not blind to the changes happening around their new location, or immune to the pull to take advantage of it, now that they've had front-row seats to the transformation of more than one run-down neighborhood. "Justin and I both really enjoy the learning curve we’ve been on with respect to real estate and the general landscape in Brooklyn," says Harkin. "We're music people right now, but I can see the interest growing as we get older; maybe we’ll indulge down the line." Back at Mister Sunday, the party is winding down after dusk settles in. Their ears ringing, glowing dancers pile into Ubers headed for Cobble Hill and Williamsburg, or trek back up under the BQE to hop the R train on Fourth Avenue for a ride to Park Slope, downtown Brooklyn, Manhattan. Someday soon, they won't have so far to go. Correction: An earlier version of this story named Jamestown as the sole developer of Industry City. Jamestown owns a 50 percent stake in the complex together with Belvedere Capital, and Angelo Gordon.