The commercial real estate market remains strong in the Lansing, Michigan, area, but it also faces its own challenges, according to the latest research from CBRE|Martin.
The retail sector in Lansing is a good example. CBRE said that in the second quarter of the year, that this sector saw the addition of new retailers to the Lansing market. But CBRE also said that vacancies in this sector will continue to rise throughout the year.
And in the office market? This sector continues to improve with the vacancy rate falling 10 basis points to 17.5 percent in the second quarter. That’s largely because the unemployment rate here is low, 3.4 percent in the quarter. That compares favorably to the 4.3 percent unemployment rate for the state of Michigan and 4 percent for the United States as a whole.
But while these numbers are good, new construction remains stalled in the office sector in the Lansing and East Lansing areas, according to CBRE’s research. In fact, CBRE says that new speculative construction in the office sector remains non-existent.
The industrial market here, not surprisingly, is strong. The industrial sector is thriving throughout most of the Midwet, and the Lansing market is no exception. CBRE says that industrial supply is not keeping up with demand, something that is pushing up rental rates and inspiring users to become more efficient in the way they use commercial space.
Overall, the industrial vacancy rate in the greater Lansing market stood at a healthy 6.8 percent, with both the North and West submarkets boasting vacancy rates under 4 percent.
CBRE reported a steady stream of industrial building sales throughout the second quarter. The biggest sales included the $1.3 million sale of 1415 Lake Lansing Road in the North submarket, the $800,000 sale of 815 Terminal in the North submarket and the $659,000 sale of 1669 E. Jolly Road in the South submarket.