For the second straight quarter, the retail sector absorption level in Metro Detroit hit the red category. In the three months through December, it was -9,586 square feet to bring the year-to-date total to -322,490 square feet, according to a fourth-quarter market analysis report from Colliers.
The North Oakland submarket brought the worst results with its -162,519 square feet of vacant space. Ann Arbor/Washtenaw was the next closest with its -81,287 square feet. Meanwhile, multiple submarkets generated positive demand, with Downriver leading the way at +76,166 square feet.
While Metro Detroit's vacancy rate of 5.2 percent remained the same from the previous two months — it's still above the national average of 4.1 percent. It's a similar trend for asking rents, which were $15.39 NNN in the area, well below the country's average of $25.37.
"The Ann Arbor/Washtenaw submarket commanded the highest asking rent at $22.58 NNN, reflecting its status as a premium market, while Flint offered the most affordable option with an average asking rent of $10.82 NNN," Colliers wrote.
Those numbers came as less new supply of 54,000 square feet came in, down from the 65,600 and 83,900 square feet seen in the previous two quarters, respectively.
However, Colliers noted that the leasing activity in the quarter "remained robust," with 278 deals completed across 904,485 square feet. West Wayne saw the most activity with its 52 leases. The largest one went to Hobby Lobby, which took 58,939 square feet in Westland.
Sales Activity in the entire region surpassed $132 million to bring the annual total to $481.6 million. Octave Holdings and Investments commanded the biggest acquisition thanks to its $39.6 million purchase of a 276,244-square-foot lifestyle center, which included five properties.