Brooklyn became a city of warehouses by at least the Civil War (1860s). In Henry Reed Stiles’s important three-volume work, A History of the City of Brooklyn (1867-1870), Brooklyn’s warehouses had already created the nickname “Walled City.” The “Walled City” nickname is historical, but is applied today to sections of DUMBO and Red Hook that still have old warehouses.
   
   
DUMBO Brooklyn: History
In 1642, when Dutch settlers began to establish farms on Long Island, ferries ran back and forth between Manhattan and the Brooklyn waterfront. In 1814, Robert Fulton introduced steamboat service from the pier that is preserved today at the foot of Old Fulton Street, making the commute an 8-minute trip.  At the height of the period, boats carried people, produce, mail and even wagons and made more than 1,000 crossings daily. This piece of the waterfront became Brooklyn’s commercial hub and was dubbed “Fulton Landing” at that time. Walt Whitman, who made his home nearby, immortalized the route in his poem, “Crossing Brooklyn Ferry.” 
 
The first urban street improvement project occurred in DUMBO in 1819 and is one of the earliest examples of formal surveying and mapping of roads and the addition of sidewalks. In reference to the mammoth warehouses erected along the entirety of the Brooklyn waterfront, Brooklyn received the nickname the “walled city.” Today, the Empire Stores in DUMBO are among the last vestiges of those dry goods storage warehouses. Throughout the 17th,18th, and 19th centuries the area was a bustling commercial center with numerous stables, taverns, inns, shops and farmers markets.  Tubal Cain Iron Works, Sweeney Metal Works, Yuban Coffee and Spices, and the Robert Gair Bottle Cap and Cardboard Box Manufacturing (corrugated cardboard was in fact invented in DUMBO), were only a few of the manufacturers who called the area home.
   
Red Hook Waterfront History and Pictures
T H E B E A R D S T R E E T W A R E H O U S E 499 Van Brunt St.
The Beard Street Warehouse, which occupies 7.5 acres, was built by William Beard in 1869 during a surge in dockside warehousing after the Civil War. By the mid-1800s, the smaller warehouses on the crowded shores of lower Manhattan were no longer able to accommodate the volume of goods flowing into the Port of New York, and Brooklyn’s spacious waterfront offered a clear advantage. In fact, so many enormous brick warehouses were constructed along the waterfront from Greenpoint to Red Hook during this period that Brooklyn soon became known as “The Walled City.”
 
Past, Present, Future of Brooklyn’s Waterfront
During what era was the natural shoreline transformed into the urban waterfront?
The change was gradual, with new streets constructed on fill in the 1850s, the construction of the initial finger piers, and the construction of the first Empire Stores on Plymouth Street and the Martin Stores on Furman Street in 1869. By the 1880’s, Plymouth and Furman Street were dense with brick warehouses storing a variety of food items, giving this portion of Brooklyn the name “the walled city.” 
 
Google Books
A History of the City of Brooklyn
by Henry Reed Stiles
Brooklyn, NY: Pub. by subscription
1870
Pg. 574:
And, since that time, private parties have been allowed to take possession of every foot of available water front; and have so completely covered it with warehouses, etc., that Brooklyn has been, not inaptly, nicknamed “the walled city.”
     
Google Books
New York: 15 Walking Tours:
An Architectural Guide to the Metropolis
by Gerard R. Wolfe
Third Edition
New York, NY: McGraw-Hill Professional
2003
Pg. 452:
They were just one of many such warehouses that lined the Brooklyn waterfront for miles, earning the borough the sobriquet “the walled city.” 
 
Brooklyn Enthusiast
Wednesday, August 23, 2006
Living in the walled city
The best part about DUMBO is that so much of its history has been preserved.
 
I was just reading on a Web site that “the first urban street improvement project occurred in DUMBO in 1819 and is one of the earliest examples of formal surveying and mapping of roads and the addition of sidewalks. In reference to the mammoth warehouses erected along the entirety of the Brooklyn waterfront, Brooklyn received the nickname the walled city.” 
 
Farewell NYC
Tuesday, September 18, 2007
Redhook
(...)
More than anything about my little journey I’m finding, I am addicted to interesting waterfronts. Redhook is all waterfront. Most of it is closed to the public, being the largest post civil war docking port. In fact, as i found out yesterday while walking around the old Beard St. Warehouse pier that after the civil war Brooklyn became so filled with large red-brick warehouses that it earned the nickname “The Walled City.”