1. Industrial Market Report
West Michigan Q3 2015
100 Grandville Ave SW Suite 100
Grand Rapids, MI 49503
616. 776. 0100 www.naiwwm.com
*Also serving the Kalamazoo & Southwest Michigan
areas from our new Kalamazoo office*
Wisinski of
West Michigan
Office • Industrial • Retail • Multi-Family
2. LowInventorygenerates
speculativeconstruction
Quality manufacturing space remains in short
supply throughout West Michigan, creating more
pressure to build.
We have a client who completed construction at
the beginning of the third quarter on a 35,000 square
foot spec industrial building in Wyoming, MI. We
have already leased over 22,000 square feet of the
building in the third quarter, and only have 2 units
available. We have another client who purchased a
176,000 square foot manufacturing facility in Battle
Creek, which was only 18% occupied, with plans to-
make some improvements to the building and find
tenants to lease the remainder of the facility.
The lack of good available manufacturing space
does create challenges. We are seeing manufacturers
look at more creative solutions such as new construc-
tion, purchasing buildings and adding on to the man-
ufacturing space, and converting distribution facilities
into manufacturing space. As a result, lease rates and
industrial property values are increasing. We expect
this trend to continue in the fourth quarter.
* The information contained herein has been given to us by sources we deem reliable. We have
no reason to doubt its accuracy, however, we do not make any guarantees. All information
should be verified before relying thereon.
* Source: NAIWisinskiofWestMI, CoStar Property®
, U.S. Bureau of Labor Statistics
“The West Michigan
Industrial inventory
continues to be tight in
the third quarter, and
we are seeing lease rates
and purchase prices
continue to increase. Due
to the low inventory we are
seeing some speculative
construction. We are also
seeing investors purchasing
buildings with either high
occupancy or below market
lease rates with the intent
of either filling the vacant
units or increasing existing
rents.”
GRAND RAPIDS, MI
The Market
- Chris Prins,
Industrial Advisor| NAI Member
3. Total Employment Growth
Highlight Total Number of Jobs Added per Year
Recent Lease Transactions, July - September 2015
Address Size (SF) Tenant Lease Type
2960 Wilson Court 10,000 Empire Wire Supply New
5028 Kraft Ave. SE 28,000 DHL Express New
3650 Broadmoor Ave. SE 14,400 MLB Tool Dies LLC New
5028 Kraft SE 28,000 DHL Express New
3691 Northridge NW, Suite 10 27,510 Laser Access, Inc. New
Recent Sales Transactions, July - September 2015
Address Size (SF) Sale Price Price PSF Sale Date
4619 Clyde Park Ave. SW 36,022 $1,150,000 $31.92 7/2/2015
4647 50th St. SE 9,200 $665,000 $72.28 9/1/2015
936 Front Ave. NW 11,576 $1,225,000 $105.82 9/4/2015
2535 3 Mile Rd. NW 5,000 $269,500 $53.90 9/25/2015
4055 Stafford Ave. SW 20,055 $530,000 $26.43 9/24/2015
Vacancy rate went from 5.3
in the previous quarter to
4.9 this quarter.
West MI EconomicTrends
Absorption, Deliveries, Vacancy
ABSORPTIONDELIVERIESINMILLIONS(SF)
VACANCYRATE
Rental rates ended the
third quarter at $4.14, an
increase over the previous
quarter.
Net absorption for the
overall Grand Rapids
Industrial market was
positive 630,959 square
feet in the third quarter.
4.7
3.4
4.1
3.6
3.4
5.2
6.7
4.9
5.9
5.2
4.9
6.3
0.02 .0 4.06 .0 8.0
Newaygo Co.
Kent Co.
Ionia Co.
Barry Co.
Grand Rapids
area
United States
Aug-14 Aug-15
Source:U .S. BLS, Local Area Unemployment
12-month percent changes in Unemployment
4. West Michigan
Industrial Submarket Statistics
Industrial Statistical Changes
CONSTRUCTION
CONSTRUCTION
ASKING RATES
ASKING RATES
VACANCY RATE
VACANCY RATE
NET ABSORPTION
NET ABSORPTION
2Q15vs. 3Q15
3Q14 vs. 3Q15
2015 Q3 Industrial Snapshot
Submarket Total RBA Vacant
Available SF
Vacancy
Rate
Total Average
NNN Rate ($/SF/Yr)
Total Net
Absorption (SF)
Total Under
Construction SF
Lakeshore
Warehouse 9,822,833 340,206 3.4% $2.79 98,168 -
Manufacturing 23,789,091 1,027,642 4.3% $2.65 196,858 -
Hightech Flex 989,227 16,487 1.6% $5.47 -3,093 -
Total 34,601,151 1,384,335 4.0% $3.64 291,933 -
Northeast
Warehouse 4,836,315 486,680 10.0% $5.20 380 -
Manufacturing 7,087,136 1,142,252 16.1% $2.76 18,990 -
Hightech Flex 669,606 40,620 6.0% $5.31 - -
Total 12,593,057 1,669,552 13.2% $4.42 19,370 -
Northwest
Warehouse 4,280,066 462,033 10.7% $3.25 900 -
Manufacturing 12,822,324 555,588 4.3% $3.15 198,330 -
Hightech Flex 1,232,064 500 - $7.25 - -
Total 18,334,454 1,018,121 5.5% $4.55 199,230 -
Southeast
Warehouse 21,935,921 969,577 4.4% $3.08 102,300 -
Manufacturing 25,158,745 1,168,444 4.6% $3.98 -87,857 -
Hightech Flex 2,960,161 148,150 5.0% $5.84 14,526 -
Total 50,054,827 2,286,171 4.5% $4.30 28,969 -
Southwest
Warehouse 8,063,603 225,109 2.7% $2.93 66,384 -
Manufacturing 21,740,604 549,756 2.5% $3.40 16,381 41,250
Hightech Flex 737,689 40,273 5.4% $5.04 8,692 -
Total 30,541,896 815,138 2.6% $3.79 91,457 -
Total Overall 146,047,235 7,173,317 4.9% $4.14 630,959 41,250
Last Quarter vs. This Quarter
Last Year vs. This Year
6. Methodology | Definitions | Submarket Map
Rental Rate
The annual costs of occupancy for a particular
space quoted on a per square foot basis.
Under Construction
Buildings in a state of construction, up until they
receive their certificate of occupancy. In order for
CoStar to consider a building under construction, the
site must have a concrete foundation in place.
Existing Inventory
The square footage of buildings that have received a
certificate of occupancy and are able to be occupied
by tenants. It does not include space in buildings
that are either planned,under construction or under
renovation.
Vacancy Rate
All physically unoccupied lease space, either
direct or sublease.
Flex Building
A type of building designed to be versatile, which
may be used in combination with office (corporate
headquarters),research and development, quasi-retail
sales, and including but not limited to industrial,
warehouse, and distribution uses. A typical flex
building will be one or two stories with at least half
of the rentable area being used as office space, have
ceiling heights of 16 feet or less, and have some
type of drive-in door, even though the door may be
glassed in or sealed off.
Industrial Building
A type of building(s) adapted for a combination
of uses such as assemblage, processing, and/
or manufacturing products from raw materials
or fabricated parts. Additional uses include
warehousing, distribution, and maintenance facilities.
Absorption (Net)
The change in occupied space in a given
time period.
Available Square Footage
Net rentable area considered available for lease;
excludes sublease space.
Average Asking Rental Rate
Rental rate as quoted from each building’s owner/
management company. For office space, a full
service rate was requested; for retail, a triple net rate
requested; for industrial, a NN basis.
Net Rental Rate
A rental rate that excludes certain expenses that a
tenant could incur in occupying office space. Such
expenses are expected to be paid directly by the
tenant and may include janitorial costs, electricity,
utilities, taxes, insurance and other related costs.
Price/SF
Calculated by dividing the price of a building (either
sales price or asking sales price) by the Rentable
Building Area (RBA).
Multi-Tenant
Buildings that house more than one tenant at a given
time. Usually, multi-tenant buildings were designed
and built to accommodate many different floor plans
and designs for different needs.
Price/SF
Calculated by dividing the price of a building (either
sales price or asking sales price) by the Rentable
Building Area (RBA).
RBA
Rentable Building Area -Mainly used for office and
industrial
Southwest
Northeast
Southeast
Northwest
Lakeshore
All Industrial building types are included,
including warehouse, flex / research
development,distribution manufacturing,
industrial showroom, and service
buildings, in both single-tenant and
multi-tenant buildings, including
owner-occupied buildings.
Methodology
7. Doug Taatjes, CCIM, SIOR
616 292 1828
dougt@naiwwm.com
Chris Prins
616 242 1107
chrisp@naiwwm.com
Kara Schroer
269 459 0434
kschroer@naiwwm.com
David Smies, CCIM, SIOR
616 242 1122
daves@naiwwm.com
Jeremy Veenstra
616 242 1105
jeremyv@naiwwm.com
Chadwick Versluis, SIOR
616 242 1125
chadv@naiwwm.com
Stanley Wisinski III, SIOR, CCIM
616 575 7015
sjw@naiwwm.com
Marc Tourangeau
269 207 3072
marct@naiwwm.com
Meet Our Team
Industrial Specialists
Jim Badaluco, SIOR
616 450 9428
jimb@naiwwm.com
Dane Davis
269 459 0435
ddavis@naiwwm.com
Stuart Kingma, SIOR
616 575 7022
skingma@naiwwm.com
Kurt Kunst, SIOR, CCIM
616 242 1116
kurtk@naiwwm.com
In the spring of 2011, two successful and reputable companies, The Wisinski Group and NAI West Michigan
merged. The merger represents collaboration, rich traditions, innovative technologies, unique cultures and
diversity of skills and specialties which ultimately benefit our clients. We’re going back to our fundamentals,
strengthening our core and becoming stronger in the services we provide our clients. Our focus is simple,
building client relationships for life by offering market appropriate advice and then executing. Our success is
a direct result of its unwavering commitment to providing the best possible service to each and every client.
Our Brokers, with their 562 plus years of combined experience (20.1 years average), possess the knowledge
and expertise to manage the most complex transactions in industrial, office, retail, and multifamily specialities
throughout West Michigan.
Through our affiliation with NAI Global, we can also assist you with your commercial real estate needs
throughout the US globally right here from West Michigan.
NAI Wisinski of West Michigan
At a Glance
Achieve More.
Local Knowledge. Global Reach.
8. 100 Grandville Ave SW Suite 100
Grand Rapids, MI 49503
616. 776. 0100 www.naiwwm.com
facebook.com/naiwwm
@naiwwm
nai-wisinski-of-west-michigan
Wisinski of
West Michigan
Office • Industrial • Retail • Multi-Family
