Lease rates hit an all-time high in the Detroit industrial market during the third quarter. And that’s just one bit of good news in the third quarter Detroit industrial report released by CBRE.
CBRE reported that the Detroit industrial market absorbed 953,793 square feet during the third quarter. At the same time, lease rates hit an historic high of $6.59 a square foot, CBRE said.
How strong is Detroit’s industrial market today? The third quarter marked the 30th consecutive quarter of positive absorption here. The vacancy rate for the market ended the quarter at 1.93 percent, the third consecutive quarter in which it remained below 2 percent.
This activity dropped the Detroit industrial market’s overall availability rate from 3.78 percent to 3.29 percent.
Industrial construction has soared, too, to meet demand. CBRE reported that three major industrial projects reached completion in the third quarter for a total of 290,000 square feet. There is currently 7.6 million square feet of construction in the industrial pipeline.
“Until more supply hits the market, we will likely see lease rates continue to rise as vacancy is incredibly tight,” said Peter Rogers, first vice president with CBRE, in a statement. “There are a lot of active users looking to expand or enter the market, but supply remains the big question.”
Progress Disribution signed the largest industrial lease in the third quarter, 638,236 square feet in Detroit. Total industrial absorption during the last four quarters was 4.2 million square feet.
