Detroit’s retail market faces a challenge unique to the city: The population is growing too slowly in the Detroit area. That makes life more challenging for retailers.
That’s one of the big takeaways from Marcus & Millichap‘s 2026 Retail Investment Forecast released earlier this week.
According to the forecast, the Detroit area’s population growth ranked among the slowest of major U.S. markets last year. At the same time, some retail tenants hesitated to sign leases in the Detroit market because of declining consumer confidence and relatively price-sensitive consumer base.
Marcus & Millichap said that this last trait is exacerbated by the metropolitan Detroit area’s low median household income. According to the report, consumer prices here have grown faster than incomes since at least 2020.
This isn’t to say that the news is all gloomy for the Detroit area’s retail market. Marcus & Millichap said that the Detroit retail market saw rapidly improving net absorption in late 2025, a positive sign. This is thanks in part to the backfilling of big-box spaces, but Marcus & Millichap said that smaller-format spaces are also seeing stronger leasing activity.
Marcus & Millichap said that much of this momentum is concentrated in single-tenant spaces and community and strip centers, while lifestyle, neighborhood and power centers continue to face weaker demand in early 2026.
What do the numbers say? Marcus & Millichap predicts that the Detroit area’s retail vacancy rate will fall by 10 basis points to 5.6% in 2026. That’s good news, but would still leave the region’s retail vacancy rate 40 basis points above the national benchmark.
Marcus & Millichap predicts, too, that the metropolitan area’s average asking rent will reach $15.20 a square foot by the end of the year, an increase of 1.5%. This average asking rent would still rank as the eighth-lowest among major U.S. markets.
Don’t expect much new retail construction, either. Marcus & Millichap says that the retail development pipeline is expected to decelerate slightly in 2026 as it predicts that total inventory here will only expand by 0.2%. Marcus & Millichap predicts that the Detroit area will see about 370,000 square feet of new retail construction this year.
