Southfield, MI Commercial Real Estate
Office Space and Industrial Leasing Experts
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The trend in commercial real estate across the country is stagnant. Few properties are being sold; Office space sales are down 70% since last year. Tightened credit guidelines make it difficult to purchase these properties forcing many building owners into bankruptcy. As unemployment rises there will be less tenants in the marketplace to lease space providing more challenges to landlords.
In addition to the overall economy, many cash strapped landlords lack the capital required to make significant upgrades to their property in order to compete with lower lease rate buildings that are in better condition. The problem will only get worse for building owners. What does this mean to the tenant? Opportunity. With a more competitive marketplace, office tenants can upgrade their space and possibly pay lower lease payments every month.
The Detroit area�s office vacancy rate decreased from 17.3% at the end the second-quarter 2008 to 17.2% at the end of the third quarter, with a positive net absorption of 49,695 square feet. The average lease rate decreased, however, from $19.86 at the end of the second quarter to $19.83 per square foot. Class B office space continues to see negative absorption, while Class A and C gain.
