Apartment construction will increase for the third straight year, but occupancy rates are at nearly 95%. This ratio is enviable, but low for Detroit, said the company.
In retail, the struggling economy and fallout from the terrorist attacks will likely lead to less development, Marcus & Millichap said. Also, retail vacancy has risen in each quarter since the fourth quarter of 2000. However, the Detroit retail market is still among the tightest in the country, the report said.
More than one million sf of office sublease space hit Detroit over the past 12 months, pushing up vacancies and slowing new construction, said the company. Investor interest was strong in 2002, but will slow in 2003 as owners wait for market recovery. Rental rates continue to post gains while new construction slows, said the Marcus & Millichap report.
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