Detroit Office Market
Average Asking Rent (Price/SF) |
$20.40 |
Vacancy Rate (%) |
18.9% |
Net Absorption (SF) |
(267,545) |
The Metro Detroit office market vacancy rate climbed 60 basis points to 18.90% during the second quarter of 2022 as just over 265,000 square feet in net vacancies were added to the market. The office market has posted eight consecutive quarters of negative absorption starting during the third quarter of 2020. Since then, over 2.4 million square feet of net vacant space as been added to the market, causing a 400-basis-point vacancy rate jump. The market continues to see a demand slump, while many offices are seeing a slight improvement in shadow vacancy, or unused leased office space, due to workers returning to the office. Many companies continue to adopt work-from-home policy, greatly reducing demand for office space. Meanwhile, available sublease space grew 16.4 percent to just over 1.4 million square feet during the second quarter of 2022. Over the past ten years, the office market saw its lowest level of sublease space of 633,000 square feet in 2017.
Download Detroit Office Market Report 2Q22Detroit Industrial Market
Average Asking Rent (Price/SF) |
$6.55 |
Vacancy Rate (%) |
4.1% |
Net Absorption (SF) |
3,130,513 |
The Metro Detroit industrial vacancy rate climbed 20 basis points as new construction completions add supply to the market in Pontiac, Livonia and Shelby Township. The industrial market continues to see very strong demand, absorbing over 3 million square feet during the second quarter of 2022. With limited available supply, speculative developments are being leased up before construction completion. Flint Development completed construction and fully leased Wixom Assembly Park A & B, totaling 875,000 square feet. NorthPoint completed construction on the Shelby Commerce Center 1, 2 and 3, totaling just over 1 million square feet with 80.0% of the development fully leased. Bulk warehouse accounts for the bulk of absorbed space and also makes up the bulk of developments currently under construction. Eight bulk warehouses facilities, both speculative and build-to-suits totaling 3.8 million square feet, were completed during the second quarter of 2022 alone. Another 15 bulk warehouses developments are currently under construction, totaling 5.5 million square feet. The market also remains tight for the general industrial market, where many submarkets’ vacancies are at 2% and lower with little to no active speculative construction.