The fourth quarter of 2018 marked another period of growth for Detroit’s industrial sector. Total vacancy fell ten basis points to 5.3 percent, while average asking rents held steady, currently coming in at $5.49 per square foot. Over 4.2 million square feet of industrial space was delivered in the fourth quarter...

1. © 2019Jones 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 2018
Detroit
Industrial Insight
The fourth quarter of 2018 marked another period of growth for Detroit’s
industrial sector. Total vacancy fell ten basis points to 5.3 percent, while
average asking rents held steady, currently coming in at $5.49 per square foot.
Over 4.2 million square feet of industrial space was delivered in the fourth
quarter, highlighted by new facilities for Amazon, Flex-N-Gate and Penske
Logistics. Over 3.4 million square feet of space is under construction, while
expansions and investment in existing facilities remain commonplace across
the metro. Healthmark has invested $20.0 million in their Fraser facility,
adding on an additional 150,000 square feet with plans to construct a new
50,000-square-foot adjacent warehouse, while Gallagher-Kaiser plans to
purchase property in Detroit to expand operations with a $9.7 million
investment.
General Motors announced they will halt production at their Detroit-
Hamtramck Assembly and Warren Transmission plants as they shift their
strategy from traditional passenger vehicles to more profitable SUVs and
trucks. Fiat Chrysler Automobiles plans to retool the idled Mack II Engine Plant
in Detroit to the next generation Jeep Cherokee.
Outlook
Looking ahead into 2019, we expect conditions to remain strong in the Detroit
industrial market. Already historic low vacancies will continue to drop, while
the construction pipeline will keep growing. Vacancies will remain at these
historically low rates until more inventory hits the market. Autonomous
vehicle technology will be a catalyst for growth in the region. As Ford’s
autonomous vehicle campus begins to take shape in Corktown, suppliers, as
well as tech companies, will want to build a presence in the metro to support
the Big Three’s needs in this space.
Fundamentals Forecast
2018 YTD net absorption 2,643,059 s.f. ▲
QTD net absorption 375,127 s.f. ▲
Under construction 3,439,269 s.f. ▲
Total vacancy 5.3% ▼
Average asking rent (NNN) $5.49 p.s.f. ▶
Tenant improvements Falling ▼
0
5,000,000
10,000,000
15,000,000
2014 2015 2016 2017 2018
Supply and demand (s.f.) Net absorption
Deliveries
Vacancy at historic lows despite robust construction
8.0%
9.3%
7.5%
5.7% 5.3%
2014 2015 2016 2017 2018
Total vacancy
For more information, contact: Harrison West | harrison.west@am.jll.com
• Total vacancy fell ten basis points to 5.3 percent since last quarter, while
average rents come in at $5.49 per square foot.
• General Motors announced they will halt production at their Detroit-
Hamtramck Assembly and Warren Transmission plants.
• Fiat Chrysler Automobiles plans to retool the idled Mack II Engine Plant
in Detroit to build the next generation Jeep Cherokee.
$0.00
$2.00
$4.00
$6.00
2014 2015 2016 2017 YTD 2018
Average asking rents ($/s.f.)
W&D Manufacturing

2. © 2019Jones 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 2018
Detroit
Industrial Statistics
For more information, contact: Harrison West | harrison.west@am.jll.com
Inventory
(s.f.)
Quarterly
total net
absorption
(s.f.)
YTD
total net
absorption
(s.f.)
YTD
total net
absorption
(% of stock)
Total
availability
(s.f.)
Total
availability
(%)
Average
total asking
rent
($ p.s.f.)
Quarterly
completions
(s.f.)
YTD
completions
(s.f.)
Under
construction
(s.f.)
Market Totals
Warehouse & Distribution 249,966,471 -56,322 1,279,232 0.5% 16,286,785 6.5% $5.56 3,788,345 5,754,623 3,049,948
Manufacturing 224,320,006 431,449 1,363,827 0.6% 9,017,433 4.0% $5.36 554,046 1,164,793 389,321
Totals 474,286,477 375,127 2,643,059 0.6% 25,304,218 5.3% $5.49 4,206,130 6,919,416 3,439,269
Flex 50,806,812 260,745 632,334 1.2% 4,417,358 8.7% $9.80 0 44,525 443,586
Airport / I-275 Corridor
Warehouse & Distribution 60,783,677 245,105 158,194 0.3% 3,691,927 6.1% $5.85 2,022,000 3,066,630 354,444
Manufacturing 39,434,648 -354,599 -247,355 -0.6% 2,484,070 6.3% $5.29 0 129,747 0
Totals 100,218,325 -109,494 -89,161 -0.1% 6,175,997 6.2% $5.62 2,022,000 3,196,377 354,444
Flex 7,127,188 106,883 69,285 1.0% 702,224 9.9% $10.74 0 0 118,785
City of Detroit
Warehouse & Distribution 38,939,039 -269,213 -101,658 -0.3% 4,095,051 10.5% $4.36 0 0 180,000
Manufacturing 39,562,112 912,705 1,134,042 2.9% 1,780,319 4.5% $4.93 350,000 350,000 0
Totals 78,501,151 643,493 1,032,384 1.3% 5,875,370 7.5% $4.53 350,000 350,000 180,000
Flex 1,926,231 -4,812 -1,426 -0.1% 180,911 9.4% $12.05 0 0 0
Downriver
Warehouse & Distribution 19,808,957 82,168 708,996 3.6% 772,549 3.9% $4.67 0 0 90,000
Manufacturing 23,721,289 9,325 190,741 0.8% 1,156,540 4.9% $4.89 0 0 0
Totals 43,530,246 91,492 899,736 2.1% 1,929,090 4.4% $4.80 0 0 90,000
Flex 5,032,427 10,102 -13,690 -0.3% 458,271 9.1% $8.80 0 0 0
I-96 Corridor
Warehouse & Distribution 27,905,961 -132,546 -254,269 -0.9% 1,732,862 6.2% $6.39 339,500 475,761 207,611
Manufacturing 15,239,653 58,911 127,433 0.8% 715,823 4.7% $6.51 0 0 341,265
Totals 43,145,614 -73,635 -126,836 -0.3% 2,448,685 5.7% $6.43 339,500 475,761 548,876
Flex 8,730,755 -21,572 113,893 1.3% 960,677 11.0% $10.19 0 0 127,782
Macomb County
Warehouse & Distribution 43,420,406 353,200 675,083 1.6% 2,071,324 4.8% $5.50 1,234,960 1,978,688 708,088
Manufacturing 58,058,046 310,924 543,384 0.9% 990,017 1.7% $5.47 69,046 450,046 48,056
Totals 101,478,452 664,124 1,218,467 1.2% 3,061,341 3.0% $5.49 1,304,006 2,428,734 756,144
Flex 4,439,162 -34,926 -61,890 -1.4% 328,540 7.4% $6.59 0 0 0
Monroe County
Warehouse & Distribution 5,151,182 8,295 223,458 4.3% 34,228 0.7% $5.03 0 0 0
Manufacturing 8,158,044 6,686 70,276 0.9% 8,444 0.1% $3.95 0 0 0
Totals 13,309,226 14,981 293,734 2.2% 42,672 0.3% $4.82 0 0 0
Flex 238,060 0 -3,538 -1.5% 3,538 1.5% $11.87 0 0 0
Northern I-75 Corridor
Warehouse & Distribution 43,788,977 -315,039 -103,053 -0.2% 3,414,356 7.8% $6.36 28,144 165,704 1,459,805
Manufacturing 29,996,752 202,463 433,416 1.4% 948,469 3.2% $6.35 135,000 235,000 0
Totals 73,785,729 -112,576 330,363 0.4% 4,362,825 5.9% $6.36 163,144 400,704 1,459,805
Flex 15,255,366 217,252 455,317 3.0% 1,505,049 9.9% $9.29 0 0 180,000
Washtenaw County
Warehouse & Distribution 10,168,272 -28,292 -27,518 -0.3% 474,487 4.7% $6.79 27,480 67,840 50,000
Manufacturing 10,149,462 -714,966 -888,110 -8.8% 933,751 9.2% $4.95 0 0 0
Totals 20,317,734 -743,258 -915,627 -4.5% 1,408,237 6.9% $5.57 27,480 67,840 50,000
Flex 8,057,623 -12,183 74,382 0.9% 278,149 3.5% $12.97 0 44,525 17,019