(Natalie Keith is a contributing writer to GlobeSt.com.)

DETROIT-With the continued restructuring of the automobile industry, the industrial market is still experiencing fluctuations. Although leasing activity has slowed overall, some tenants are taking advantage of soft conditions to lease or buy property, according to first quarter 2006 industrial market reports.

"We saw a number of large deals during the quarter, but the activity is still up and down," John DeGroot, Grubb & Ellis research services manager in Detroit, tells GlobeSt.com. "This will likely remain for the next several quarters."

For the first quarter, Grubb & Ellis reported net absorption of 911,947 sf in the metropolitan Detroit area. Among noteworthy transactions were KUKA Flexible Production Systems sublease of 312,000 sf in the North Bay Park of Industry in Chesterfield Township and Cadence Innovation's purchase of a 172,000-sf warehouse/office facility in Troy, according to the report. Despite the activity, the vacancy rate remained at 12.5%. Asking rental rates for the quarter averaged $4.70 per sf for general/manufacturing space, $4.11 per sf for warehouse/distribution space and $9.60 for research & development/flex space, the report notes.

In its first quarter 2006 industrial market report, Colliers International reported less optimistic numbers. The company reported negative net absorption of 3.1 million sf in metro Detroit's industrial/flex market. This compared with a positive net absorption of 2.2 million sf during the first quarter of 2005. Colliers reports an overall vacancy rate of 13%.

The market may be hampered further by continued shakeup in the automotive industry. General Motors plans to cut 0.7% of its 36,000 salaried employee work force, or about 2,500 jobs. The state's unemployment rate has already increased 0.2% to 6.8% between year end and February, the Colliers' report notes.