Detroit's Market Rates are Always Changing, Let us Help Navigate You
In the last month or so we have been talking with tenants in the Central Business District of Detroit, who got sticker shock when their lease came up for renewal. In one case, free parking was eliminated in a renewal. The cost of parking for this small staff increased by $30,000/year plus a rental increase of $10,000/year. Not many nonprofits can stomach that type of an increase.
Just a few days later we got a call from a staffing firm in Detroit, located in a different part of the city. They were hoping to move to a less expensive building and continue to get free parking. I hated to break the news to them, but I knew their landlord was taking away their free parking too. While they thought their rental rate of $16.00/s.f. was too high, I had to inform them that the rate was significantly below market for their building too. I hate giving this type of news. We will be heading back to the suburbs where there is no city tax, no parking charges, and decent buildings for several dollars a square foot less.
There are still some good buildings downtown that don’t charge for parking, but there are only a handful that I’m aware of. As our city starts charging rents more characteristic for a major city, it will be interesting to see what will happen to the nonprofits and smaller firms who were located in the city long before it became cool to be stationed in Detroit.
Wondering what the market rate is for office space in Detroit? Send us your Name, Business, Email and Phone Number and we will send you’re the most recent market study from Costar.