Top Tax Incentives for Companies Opening Offices in Brooklyn

If your company operates in Brooklyn, you may be eligible for two powerful tax incentive programs that can dramatically reduce your occupancy costs: the Commercial Rent Tax (CRT) exemption and the Relocation and Employment Assistance Program (REAP). Together, these programs can save qualifying businesses thousands of dollars annually.

Commercial Rent Tax Exemption

The Commercial Rent Tax has a unique history in New York City. Originally enacted in 1963, the CRT was designed to tax commercial tenants primarily in Manhattan below 96th Street. However, the tax technically applies citywide to any business whose annual base rent exceeds $250,000 (or whose rent per square foot exceeds certain thresholds).

Here's where Brooklyn businesses benefit: while the CRT exists on the books for all five boroughs, the city provides a 100% exemption for businesses located outside of Manhattan below 96th Street. This means Brooklyn-based companies are effectively exempt from the tax, even if their rent would otherwise trigger CRT obligations. This exemption was designed to encourage business growth in the outer boroughs and level the playing field for companies that choose to locate outside Manhattan's core.

For businesses that would otherwise face CRT obligations—which can amount to up to 6% of base rent—this Brooklyn exemption represents substantial savings. A company paying $100,000 in annual rent could save up to $6,000 per year simply by being located in Brooklyn rather than lower Manhattan.

Understanding REAP

The Relocation and Employment Assistance Program offers a refundable tax credit of $3,000 per eligible employee, per year, for up to 12 years. This program is designed to encourage businesses to relocate or expand to lower Manhattan or outer boroughs like Brooklyn. To qualify, your company must be in eligible industries such as financial services, technology, media, professional services, or manufacturing, and maintain a minimum number of employees at your Brooklyn location.

REAP credits can offset New York City business taxes, and any excess credits are fully refundable, making this an especially valuable benefit for growing companies. The savings add up quickly—a company with 20 eligible employees could receive $60,000 annually in tax credits.

How Two Trees Can Help

Navigating these tax incentive programs can be complex, but that's where Two Trees makes a difference. As your landlord and partner, Two Trees has extensive experience helping tenants successfully apply for and secure both REAP credits and CRT exemptions. Our team provides:

1) Expert guidance on eligibility requirements and application procedures

2) Documentation support to ensure your applications are complete and accurate

3) Coordination with city agencies to streamline the approval process

4) Ongoing compliance assistance to maintain your benefits year after year

Two Trees' dedicated team understands the intricacies of these programs and has a proven track record of helping Brooklyn tenants maximize their tax savings. When you lease with Two Trees, you're not just getting exceptional space—you're gaining a partner committed to your financial success.

Ready to explore how much your company could save? Contact Two Trees today to learn more about these valuable incentive programs and how we can help you take full advantage of them.