Chris Holman welcomes back Van W. Martin, SIOR, CCIM, and CRE. President & Chief Executive Officer, Martin Commercial Properties, Lansing, MI.
Watch Van and Chris review Martin Commercial Properties and the findings of the recent first half of 2023 report, in the YouTube video shared below:
Van, welcome back, it's quite possibly been just over 4 years since we had you on! Please remind the Michigan business community about the comprehensive commercial real estate services Martin Commercial Properties provides?
A “New Normal” Office Market, and Rent Rising in Industrial
The highly anticipated “Market Insights” report from Martin Commercial Properties provides an in-depth analysis of the region’s retail, industrial, and office real estate sectors.
EAST LANSING, Mich. – Martin Commercial Properties released its biannual Market Insights Report detailing Mid-Michigan’s commercial real estate market across the industrial, office, and retail sectors. This extensive report covers the first half of the fiscal year (H12023 – January through June) and provides an in-depth analysis of vacancy rates, lease renewals, typical lease rates, sale activity, and more.
Key findings from the report include:
· Industrial
o Vacancy rates of leased industrial space in Greater Lansing averaged 5.6%, up from 3.5% in H2 2022 and up from 1.6% a year ago. However, industrial occupier trends remain positive and there are few quality options for users in the market.
o Rental rates continue to rise, and concessions are nearly non-existent.
o Due to limited demand and increased material/labor costs, no new speculative or build-to-suit projects broke ground during H1 2023.
o Capital markets activity remained steady with the largest investment sales occurring in the South Submarket and included 2325 Jarco Dr. ($4.95 million) and 4940 Contec Dr. ($3.3 million).
· Office
o The average market vacancy rate remained flat, increasing 2 basis points over H2 2022 figures and 1 basis point over H1 2022 numbers, suggesting a “new normal”.
o Rental rates are largely unchanged.
o Tenants are electing to sign shorter-term leases for less space. Interestingly, the number of lease transactions during H1 2023 was up 24.4% over H2 2022 activity, while overall leave value was down 31.1%.
o Speculative construction is non-existent.
· Retail
o Average vacancies rose from 15.8% in H2 2022 to 16.5%. However, retail interest is up, and deals are getting done.
o Big Box retailers continue to make commitments to the market such as Trader Joe’s Dave & Busters, Ross Dress for Less, Harbor Freight, and FunCity Adventure Park.
o The Lansing Mall (West Submarket) continues to shed vacancies; recent leases include a new Hela’s Kitchen and a 5,000 SF expansion of The Fretail Store.
o Construction will soon be underway for Haslett Village, a new $65 million mixed-use project at the corner of Haslett and Marsh Rds.
Martin Commercial Properties is the premier commercial real estate firm in Mid-Michigan. The company leverages its 60 years of knowledge, influence, and resources to generate wins for its clients while providing strategic advice and execution in a complete range of commercial real estate services; brokerage, property development, property management, investment services, and corporate services.
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