Detroit Office Market
| Average Asking Rent (Price/SF) | $20.34 |
| Vacancy Rate (%) | 16.8% |
| Net Absorption (SF) | -180,924 |
The Metro Detroit office market vacancy rate climbed 30 basis points to 16.8% during the second quarter of 2021 as nearly 181,000 square feet in net vacancies were added to the market. The market continued to be in pandemic mode with state mandated occupancy restrictions leaving companies to continue work-from-home policies and suppressing market activity. Sublease space grew 2.5% to just over 1.1 million square feet during the second quarter compared to 2.0% growth from the previous quarter. Despite being in pandemic mode, the market did see some encouraging new leasing activity in Southfield, Troy and Farmington Hills that suggests companies are preparing for a return to the office in the third quarter. With state-mandated restrictions removed heading into the third quarter, the office market will see a gradual return to normal as companies rebalance work-from-home and work-from-office policies. Meanwhile, investments continue to be made in Detroit CBD, with Bedrock and H.W. Kaufman Group acquiring property, and in Farmington Hills, where Mercedes-Benz Financial Services is near completion on a new 200,000-square-foot headquarters.
Download Detroit Office Market Report 2Q21Detroit Industrial Market
| Average Asking Rent (Price/SF) | $6.04 |
| Vacancy Rate (%) | 4.4% |
| Net Absorption (SF) | 3,242,558 |
The Metro Detroit industrial vacancy rate fell 50 basis points to 4.4% during the second quarter of 2021 as just over 3.2 million square feet were absorbed. Construction activity remains strong for both build-to-suits and speculative developments. Four major build-to-suits were completed during the quarter: Amazon’s 823,000-square-foot facility on the former Pontiac Silverdome site; NBL Corporation’s 171,000-square-foot building in Novi; U.S AutoForce’s 126,000-square-foot facility in Wixom; and Auburn Pharmaceutical Co’s 65,000-square-foot building in Rochester Hills. Market conditions remain strong and continue to respond favorably to new speculative developments. Year-to-date, speculative construction has grown 27% to over 3.5 million square feet. The new developments under construction include: the Oakland Logistics Center; Wixom Assembly Park; Shelby Commerce Center; and the M3 Commerce Center. Since 2015, nearly 13 million square feet of new bulk warehouse space to the market in the form of new construction. Despite the new supply, the Class A and Class B bulk warehouse vacancy rate is just 1.6%.
Download Detroit Industrial Market Report 2Q21