Office Tenants Upgrade to Detroit's Top-Tier Space

DETROIT, MI — Although some areas of Detroit will maintain a healthy supply/demand balance, significant stress in the automobile industry will continue to apply pressure to office fundamentals in 2008, according to a second-quarter Office Research Report by Marcus & Millichap, the nation’s largest real estate investment services firm.

(Cadillac Tower Building, top right. First National Building, top left).

Tenants that sign new leases are anticipated to upgrade space quality and location this year due to falling rents throughout the region.

“High initial yields are projected to keep investors interested in Detroit-area assets, though limited reinvestment opportunities could impede listing, easing transaction velocity,” says Steven Chaben, regional manager of the Detroit office of Marcus & Millichap.

Following are some of the most significant aspects of the Detroit Office Research Report:

· Developers are expected to add 300,000 square feet of new office space to the Detroit market in 2008.
· Vacancy is forecast to end the year at 22.9 percent.
· Asking rents are projected to finish the year at $19.55 per square foot.
· Effective rents will end the year at $15.96 per square foot.
· The educational and health services sector has added 6,000 jobs during the past year, which has supported medical office demand.

For a copy of the complete Detroit Office Research Report, as well as reports on other markets nationwide, visit our website at http://www.marcusmillichap.com/.

Press Contact: Stacey Corso, Communications Department, (925) 953-1716