From the NY Times:
Though there are plenty of start-ups that favor Williamsburg and Greenpoint, developers, local officials and real estate brokers say there is a dearth of office space. Most landlords, lured by the promise of building lucrative apartments in the increasingly popular residential area, are reluctant to devote space to commercial tenants who can pay little and might wither as quickly as they bloom.
For some longtime residents and younger champions of north Brooklyn, the shortage raises the specter of a creative, economically diverse neighborhood turning into just another bedroom community. Will entrepreneurs follow the lead of Kickstarter, which is renovating an old factory in Greenpoint to serve as its long-term headquarters, or will the area’s booming residential market squeeze out everything but wealthy commuters?
Part of the problem is zoning: though parts of Williamsburg and Greenpoint are zoned for mixed commercial and residential use, the zoning tilts residential. The bigger issue is supply, or as developers might see it, demand.
...it was not uncommon for the owners of old factories or warehouses — the kind of industrial building every developer wants — to refuse to sell because they are holding out for their properties to be rezoned for residential use.