Inflation will put some pressure on that though and of course no one knows yet the impact of President Trump, where interest rates or 421a are heading so there's more uncertainty.

GlobeSt.com: What's the state of the apartment rental market?

Horowitz: It's not strong compared to a year ago, clients are saying it's taking longer to lease and they need to offer more concessions than they did 18 months ago, though they're getting higher rents than expected two years ago.

The market was the strongest it's ever been 18 months ago but changes to rent stabilization have made it less attractive to investors. Plus when 421a expired, construction loan lending stopped. We're still selling at extremely strong numbers, the demand just isn't as healthy.

GlobeSt.com: And what are you seeing on the office front?

Horowitz: There is a good number of larger floor plates available for rent but there aren't enough companies ready to move from Manhattan to Brooklyn yet to fill that need. I do think that will change slowly over time as more and more employers elect to move closer to where their employees live. I'm bullish on the market because employers want to be where employees are located. City Point, the mixed-use development being built Downtown, has office space and services in that neighborhood are improving.

There's a tremendous amount of inventory in Dumbo, and it all will get rented but demand is outpacing supply. It just takes time. We're also seeing a greater interest in Industry City.

GlobeSt.com: Some transportation changes are headed to Brooklyn. How might that impact the market?

Horowitz: In terms of the effect of the impending L train shut down, we're getting mixed signals. Some people are saying, 'It's just another bus ride and I love where I live' while others are saying, 'I will move when my lease expires.'

So when the MTA shuts it down, do renters leave and does retail close? Where do people who live in the affected areas go?

People in Williamsburg will be fine but those further along on the L will be affected and they don't want to move to Williamsburg and Greenpoint; they want less developed areas. Sunset Park could provide a similar community. It's still on the N/R line and rents are comparable to Bushwick.

I don't think anyone knows the impact until it really happens but it's a constant topic of conversation in the market. Buyers are using it to lower their price, saying they won't be able to get same rents. But we have yet to feel it having a marked effect on investment sales.

As for Mayor De Blasio's proposed trolley system, it would increase interest in Brooklyn. If you can get from Williamsburg to Downtown Brooklyn, it will be much easier to commute. I think it's a great idea.

NEW YORK CITY—No one would argue against the notion that Brooklyn's meteoric rise will continue in 2017—the growth potential is crystal clear. But just how much it will surge remains an open question. In this EXCLUSIVE story—part two in GlobeSt.com's series on Brooklyn, John Horowitz, VP, regional manager—Brooklyn, Marcus & Millichap, weighs in.

GlobeSt.com: What do you expect to see in 2017 in the investment sales market?

John Horowitz, VP, regional manager–Brooklyn, Marcus & Millichap: The number of transactions may decline but prices will remain strong. In prime areas of Brooklyn, you see cap rates in the mid 4s and they move up as you move to less in demand neighborhoods.

What's drawing people to own in Brooklyn will continue to be drivers. Millenials want to be there and employers want to go where employees are based. Plus, you still can buy in Brooklyn at a discount to Manhattan, or rent to the same type of tenant.

Inflation will put some pressure on that though and of course no one knows yet the impact of President Trump, where interest rates or 421a are heading so there's more uncertainty.

GlobeSt.com: What's the state of the apartment rental market?

Horowitz: It's not strong compared to a year ago, clients are saying it's taking longer to lease and they need to offer more concessions than they did 18 months ago, though they're getting higher rents than expected two years ago.

The market was the strongest it's ever been 18 months ago but changes to rent stabilization have made it less attractive to investors. Plus when 421a expired, construction loan lending stopped. We're still selling at extremely strong numbers, the demand just isn't as healthy.

GlobeSt.com: And what are you seeing on the office front?

Horowitz: There is a good number of larger floor plates available for rent but there aren't enough companies ready to move from Manhattan to Brooklyn yet to fill that need. I do think that will change slowly over time as more and more employers elect to move closer to where their employees live. I'm bullish on the market because employers want to be where employees are located. City Point, the mixed-use development being built Downtown, has office space and services in that neighborhood are improving.

There's a tremendous amount of inventory in Dumbo, and it all will get rented but demand is outpacing supply. It just takes time. We're also seeing a greater interest in Industry City.

GlobeSt.com: Some transportation changes are headed to Brooklyn. How might that impact the market?

Horowitz: In terms of the effect of the impending L train shut down, we're getting mixed signals. Some people are saying, 'It's just another bus ride and I love where I live' while others are saying, 'I will move when my lease expires.'

So when the MTA shuts it down, do renters leave and does retail close? Where do people who live in the affected areas go?

People in Williamsburg will be fine but those further along on the L will be affected and they don't want to move to Williamsburg and Greenpoint; they want less developed areas. Sunset Park could provide a similar community. It's still on the N/R line and rents are comparable to Bushwick.

I don't think anyone knows the impact until it really happens but it's a constant topic of conversation in the market. Buyers are using it to lower their price, saying they won't be able to get same rents. But we have yet to feel it having a marked effect on investment sales.

As for Mayor De Blasio's proposed trolley system, it would increase interest in Brooklyn. If you can get from Williamsburg to Downtown Brooklyn, it will be much easier to commute. I think it's a great idea.