The industrial sector in Lansing, Michigan, remains a strong, with a low vacancy rate and continued positive absorption, according to the latest research from Colliers.
Colliers reported that as of the end of the second quarter, the overall vacancy rate in the Lansing industrial market fell to 2.6%. That’s down from a still-low vacancy rate of 3% as of the end of the second quarter a year ago.
The market, though, is evolving, with demand for industrial space throughout the Lansing region tempering. Colliers said that users absorbed just under 167,000 square feet of industrial space in the market in the first half of 2025. That’s a big drop from the first half of last year, when tenants absorbed a 674,900 square feet of industrial space in the market.
What’s behind the change? The booming pace of industrial absorption that started during the COVID-19 pandemic was unsustainable. The more measured pace of absorption during the first half of this year might represent a more realistic level. Colliers said that the slower pace of absorption signifies an industrial market that is stable.
Overall asking lease rates fell to $7.64 a square foot in the Lansing industrial market as of the end of the first half of the year. That’s down from the first half of 2024, when this figure stood at $8.20 a square foot.
About 3.1 million square feet of new industrial construction is underway now in the Lansing market, according to Colliers. That’s almost identical to the amount of new industrial construction taking place last year at this time.
Colliers said that with minimum new industrial supply entering the market, it expects the Lansing vacancy rate to remain at a low level throughout the rest of the year.
