Detroit Retail Market Report
Multi-Tenant Vacancy Shrinks to Third Lowest in the Nation,
While Single-Tenant Faces Headwinds
Net absorption trends negative. Entering April, Detroit had one of the highest office vacancy rates among major Midwest markets. A slow return to in-person office work has hindered mid-day foot traffic for retailers in the market. By the end of the year, retail vacancy in the metro will sit 50 basis points above the 2019 rate as net absorption shifts negative for the second time since at least 2008. While tenants like Bed Bath & Beyond are relinquishing space in the market, several large leases have been signed in just the first half of the year. Three Ross Dress for Less stores will take up a cumulative 75,000 square feet of space across Southgate, Westland and Grand Blanc. Household income growth is also expected to surpass the 10-year average pace in 2023 and in the next five years, which may aid long-term spending and draw tenants in the future.