Total vacancy fell to 18.5 percent across the metro, while average asking rents rose to $19.18. In total, 885,582 square feet of office space was absorbed in 2017. Multiple significant lease transactions took place in the fourth quarter, perhaps most notably Google’s announcement to move from Birmingham to a 17,000-square-foot space at the office component of the new Little Caesars Arena

1. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Q4 2017
Detroit
Office Insight
The fourth quarter marked a strong finish for the metro Detroit office market.
Total vacancy fell to 18.5 percent across the metro, while average asking rents
rose to $19.18. In total, 885,582 square feet of office space was absorbed in
2017. Multiple significant lease transactions took place in the fourth quarter,
perhaps most notably Google’s announcement to move from Birmingham to
a 17,000-square-foot space at the office component of the new Little Caesars
Arena. UBS announced plans to open a 13,000-square-foot office downtown
on Woodward, while WJR extended their lease at the Fisher Building. In the
suburbs, Village Green moved their offices into a 35,000-square-foot space at
28411 Northwestern Highway, and DXC signed a 122,000-square-foot lease at
3000 University Drive in Auburn Hills.
In what has become a growing trend throughout the year, significant
investment and user sales continued in the fourth quarter. Bedrock
purchased the Buhl Building and Harvard Square center downtown, and
Foster Financial bought Central Park Plaza in Southfield for $5.1 million.
Beaumont purchased First Center in Southfield and will initially occupy
360,000 square feet. On the development front, the ceremonial
groundbreaking for the Hudson’s site development took place in December
with demolition and site work set to begin in early 2018.
Outlook
Looking ahead into the New Year, we can expect rent and vacancy trends to
stay on course. We’ll look for tenants to continue their flight to quality while
landlords upgrade and modernize their assets in an attempt to capture this
movement. Expect user sales (similar to Beaumont’s and United Shore
Mortgage’s acquisitions) to remain somewhat common, as users see the
benefits of owning their space. The development pipeline will likely continue
to grow given the demand and health of the market, and the sight of cranes in
the downtown skyline will be more than welcome in 2018.
Fundamentals Forecast
2017 absorption 885,582 s.f. ▲
Under construction 471,288 s.f. ▲
Total vacancy 18.5 % ▶
Average asking rent (gross) $19.18 p.s.f. ▲
Concessions Falling ▼
0
500,000
1,000,000
1,500,000
2013 2014 2015 2016 2017
Supply and demand (s.f.) Net absorption
Deliveries
Strong finish to the year for Detroit’s office market
25.4% 25.1%
19.0% 20.2% 18.5%
2013 2014 2015 2016 2017
Total vacancy
$0.00
$15.00
$30.00
2013 2014 2015 2016 2017
Average asking rents ($/s.f.) Class A
Class B
For more information, contact: Harrison West | harrison.west@am.jll.com
• Notable downtown moves like Google and UBS highlight fourth quarter
leasing activity
• User sales and investment sales make up transaction activity, with First
Center and Buhl Building trading, among others
• Flight to quality continues for tenants, as market awaits new class A
office construction

2. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Q4 2017
Detroit
Office Statistics
For more information, contact: Harrison West | harrison.west@am.jll.com
Class
Inventory
(s.f.)
Total net
absorption
(s.f.)
YTD total net
absorption
(s.f.)
YTD total net
absorption (%
of stock)
Direct vacancy
(%)
Total vacancy
(%)
Average
direct asking
rent ($ p.s.f.)
YTD
Completions
(s.f.)
Under
Development
(s.f.)
CBD Totals 13,317,209 -46,634 -14,412 -0.1% 12.9% 13.5% $21.68 67,430 160,000
New Center Totals 1,142,100 -25,345 29,183 2.6% 21.3% 21.3% $18.62 0 0
Urban Totals 14,459,309 -71,979 14,771 0.1% 13.5% 14.1% $21.25 67,430 160,000
Birmingham/Bloomfield Totals 3,979,668 -10,638 -23,120 -0.6% 16.6% 16.9% $26.25 0 0
Dearborn Totals 2,705,625 41,202 163,855 6.1% 27.7% 27.9% $16.26 0 150,000
Downriver Totals 483,907 -242 -2,157 -0.4% 40.6% 41.2% $14.75 0 0
Farmington/Farmington Hills Totals 4,658,516 1,155 -36,669 -0.8% 18.0% 18.1% $19.32 30,000 0
Macomb Totals 1,286,875 23,703 -565 0.0% 19.2% 19.2% $16.29 0 0
North Oakland Totals 2,207,648 150,476 -20,803 -0.9% 20.2% 20.8% $19.13 0 0
Northern I-275 Corridor Totals 4,467,691 20,700 107,441 2.4% 10.3% 11.7% $18.68 255,980 0
Royal Oak / SE Oakland Totals 706,710 13,141 2,946 0.4% 6.3% 6.3% $15.76 0 131,288
Southern I-275 Corridor Totals 1,077,525 0 -6,917 -0.6% 0.1% 1.1% $15.00 0 0
Southfield Totals 13,595,696 616,243 568,477 4.2% 25.6% 26.5% $17.90 0 0
Troy Totals 11,003,062 106,374 245,194 2.2% 21.5% 22.1% $18.57 0 0
Washtenaw Totals 6,613,772 120,289 148,129 2.2% 8.7% 9.4% $22.57 0 30,000
Suburbs Totals 52,786,695 807,403 870,811 1.6% 19.1% 19.7% $18.88 285,980 311,288
Detroit Totals 67,246,004 735,424 885,582 1.3% 17.9% 18.5% $19.18 353,410 471,288
CBD A 6,194,714 -31,611 -34,835 -0.6% 8.9% 10.1% $23.63 67,430 160,000
Urban A 6,194,714 -31,611 -34,835 -0.6% 8.9% 10.1% $23.63 67,430 160,000
Birmingham/Bloomfield A 1,569,497 -11,170 2,464 0.2% 23.3% 23.7% $28.63 0 0
Dearborn A 446,890 45,313 46,932 10.5% 0.8% 0.8% $27.50 0 150,000
Farmington/Farmington Hills A 618,109 -15,157 -42,362 -6.9% 19.9% 19.9% $24.39 0 0
Macomb A 295,494 2,647 14,359 4.9% 0.7% 0.7% $19.62 0 0
North Oakland A 488,665 11,013 2,546 0.5% 22.2% 22.2% $21.02 0 0
Northern I-275 Corridor A 1,113,719 10,091 4,559 0.4% 5.6% 7.0% $18.85 255,980 0
Southern I-275 Corridor A 832,753 0 -10,217 -1.2% 0.0% 1.2% $0.00 0 0
Southfield A 2,970,217 63,964 28,160 0.9% 23.5% 24.1% $22.42 0 0
Troy A 1,924,131 -74,546 -49,642 -2.6% 18.6% 20.3% $22.00 0 0
Washtenaw A 3,218,983 44,893 58,017 1.8% 10.5% 11.6% $26.06 0 0
Suburbs A 13,478,458 77,048 54,816 0.4% 15.3% 16.1% $23.88 255,980 150,000
Detroit A 19,673,172 45,437 19,981 0.1% 13.3% 14.2% $23.84 323,410 310,000
CBD B 7,122,495 -15,023 20,423 0.3% 16.3% 16.5% $20.61 0 0
New Center B 1,142,100 -25,345 29,183 2.6% 21.3% 21.3% $18.62 0 0
Urban B 8,264,595 -40,368 49,606 0.6% 17.0% 17.2% $20.21 0 0
Birmingham/Bloomfield B 2,410,171 532 -25,584 -1.1% 12.2% 12.4% $22.76 0 0
Dearborn B 2,258,735 -4,111 116,923 5.2% 33.0% 33.3% $16.21 0 0
Downriver B 483,907 -242 -2,157 -0.4% 40.6% 41.2% $14.75 0 0
Farmington/Farmington Hills B 4,040,407 16,312 5,693 0.1% 17.7% 17.8% $18.36 30,000 0
Macomb B 991,381 21,056 -14,924 -1.5% 24.8% 24.8% $16.17 0 0
North Oakland B 1,718,983 139,463 -23,349 -1.4% 19.7% 20.4% $18.51 0 0
Northern I-275 Corridor B 3,353,972 10,609 102,882 3.1% 11.8% 13.3% $18.66 0 0
Royal Oak / SE Oakland B 706,710 13,141 2,946 0.4% 6.3% 6.3% $15.76 0 131,288
Southern I-275 Corridor B 244,772 0 3,300 1.3% 0.5% 0.5% $15.00 0 0
Southfield B 10,625,479 552,279 540,317 5.1% 26.1% 27.1% $16.86 0 0
Troy B 9,078,931 180,920 294,836 3.2% 22.1% 22.4% $17.59 0 0
Washtenaw B 3,394,789 75,396 90,112 2.7% 7.1% 7.3% $18.14 0 30,000
Suburbs B 39,308,237 1,005,355 1,090,995 2.8% 20.4% 20.9% $17.45 30,000 161,288
Detroit B 47,572,832 964,987 1,140,601 2.4% 19.8% 20.3% $17.77 30,000 161,288