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Detroit Office Market

Average Asking Rent (Price/SF) $19.38
Vacancy Rate (%) 17.0%
Net Absorption (SF) 180,234

The Metro Detroit Office market vacancy rate fell 20 basis points to 17.0% during the third quarter of 2017, as just over 180,000 square feet was absorbed. Year-to-date absorption in 2017 totaled 386,000 square feet, compared with 1.2 million square feet during the same period in 2016. While absorption levels have slowed in many of the suburban markets, the momentum is still strong in the Detroit Central Business District, as it marks its 21st straight quarter of positive absorption. With demand for office space at levels never seen in the Detroit CBD, investments including new sporting venues, retail districts and residential developments have grown into the billions of dollars. As money and energy pour into the city, developers are betting that investments made in new and renovated office buildings will continue to pay off in the future.

Detroit Industrial Market

Average Asking Rent (Price/SF) $4.92
Vacancy Rate (%) 5.3%
Net Absorption (SF) 1,437,460

Metro Detroit's industrial market posted its 28th consecutive quarter of expansion, as nearly 1.4 million square feet was absorbed during the third quarter of 2017, driving its vacancy rate down 20 basis points to 5.3%. The expansion in the industrial market continues to drive up rents for existing inventories while pushing new construction to even greater levels. Since the third quarter of 2016, the average effective lease rate paid by tenants has risen 8.25%, while construction levels have risen 95.0%. Amazon, Inc. alone accounts for 45.0% percent of the construction increase over the past four quarters, as the company has begun to invest heavily in the metro area. Meanwhile, Amazon, Inc. is in the planning stages of constructing another 1.0 million-square-foot facility in addition to the two facilities currently under construction, for a total of 1.8 million square feet. As of third-quarter 2017, active construction levels have reached 8.2 million square feet. Just over 72% are build-to-suits, while 28% are speculative projects.



Detroit Office Market Report
3Q17
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Detroit Industrial Market Report
3Q17
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