A lack of new speculative development should help keep vacancy rates steady in Detroit’s office sector, according to the latest research from Marcus & Millichap.
In its 2026 Office Investment Forecast, Marcus & Millichap predicted that the office vacancy rate in the Detroit metropolitan area will increase slightly this year, ending 2026 at 15.7%. That would be an increase 10 basis points from 2025. That rate would be 110 basis points below the long-term mean for the Detroit office sector, Marcus & Millichap said.
“Limited speculative development and improving demand for larger floorplans are helping stabilize Detroit’s office market fundamentals as the metro moves through 2026,” said Gordon Navarre, managing director and market leader in Marcus & Millichap’s Detroit office.
Marcus & Millichap is also predicting modest growth in office asking rents throughout the Detroit metropolitan area. According to the report, the average asking rent for Detroit-area office space stood at $18.50 a square foot in December. That’s an increase of just 1.5% during the last five years.
The Detroit area is expected to see 860,000 square feet of new office construction in 2026, Marcus & Millichap says. That will expand the local office inventory by 0.5%, a percentage that is marginally above both the metropolitan area’s decade-long annual average and the national forecast of 0.4%.
In its report, Marcus & Millichap says that investors will likely be cautious in 2026 when it comes to sinking their dollars into Detroit-area office assets. One reason? Michigan’s recent move to decouple from federal bonus depreciation and accelerated expensing rules narrows the tax benefits that woud otherwise have supported acquisitions and redevelopment.
Because of this, Marcus & Millichap predicts that speculative acquisitions will slow in 2026 with investors focusing more on office assets backed by stronger fundamentals or local government incentives.
Despite the challenges facing the Detroit-area office sector, Marcus & Milichap’s Navarre said that 2026 should bring at least some stability to this asset class.
“While absorption remains uneven, the lack of new construction and renewed tenant interest in well-located assets are creating a more balanced outlook for Detroit’s office sector,” said Navarre.
