DETROIT—Throughout much of the Midwest, suburban office tenants have been migrating into the CBDs, and the Detroit region has certainly seen its share of those transfers. But according to third quarter research just published by Newmark Grubb Knight Frank, this trend has subsided, at least for now. And overall, the metro region's office market continues to see a falling vacancy rate and a relatively healthy pace of absorption as its recovery continues.

“The office vacancy rate for the metro area fell 90 bps, to 21.8%, during the third quarter of 2014 as just over 600,000-square-feet was absorbed,” the report says. NGKF officials were not available for comment by press time.

The suburbs seem to have built up a little momentum after a long slide. In fact, the Southfield submarket posted the highest absorption figures. The town's vacancy rate fell 200 bps, and just over 310,000-square-feet was absorbed. The big number was largely due to Oakland County College's move into North Park Plaza at 17117 W. Nine Mile Rd. Blue Cross Blue Shield of Michigan and other companies moved out of Southfield and into the CBD in 2011, helping to send the vacancy rate to more than 31%. But so far this year, the submarket has seen nearly 500,000-square-feet of positive absorption and the vacancy rate, now at 25.7%, fell 4.1 percentage points.

Meanwhile, the office submarket in Troy also posted solid gains as Molina Healthcare, Inc. expanded operations. The company purchased a 197,000-square-foot office building at 880 W. Long Lake Rd. and will occupy 105,000-square-feet. The city's office vacancy rate fell 90 bps, to 24.9% and just over 110,000-square-feet was absorbed. “Troy has posted nearly 560,000-square-feet of positive absorption — outpacing 2013 year-end total of 123,000-square-feet,” the report notes.

In 2011, Blue Cross Blue Shield, DTE Energy and Quicken Loans took over a combined 750,000-square-feet of downtown space. And in 2012, Title Source Inc., Chrysler, PricewaterhouseCoopers, Metro-West Appraisal Co. and Agency 720 leased almost 500,000-square-feet. But these big moves have slowed down. Still, the CBD vacancy rate fell 20 bps, to 22.8%, during the third quarter of 2014 as just over 20,000-square-feet was absorbed. And smaller creative firms continue to find downtown appealing. Mindfield, for example, a media production company, just leased 12,000-square-feet at 1942 Grand River Ave.

“Year-to-date, the CBD has posted just over 341,000-square-feet of positive absorption,” NGKF notes. “While year-end absorption is unlikely to reach 2013 levels of over 600,000-square-feet, the coming quarters are set to see move-ins that will keep net absorption positive.”