Detroit Retail Market Report

Minimal new supply and increased foot traffic a tailwind for retail properties. Over the last three years, Detroit has seen annual inventory additions at only around half of the long-term average. This limited construction enabled vacancy to approach record lows in 2022 and facilitated modest rent growth. Completions in 2023 are expected to remain low. Supply chain constraints and developer concerns surrounding the cost of financing may stall future projects going forward as well. Meanwhile, redevelopment initiatives are becoming increasingly interesting to retailers, such as the underway 444 Peterboro mixed-use project in Detroit-The Pointes. This development was over 95 percent leased at the close of last year, nearly 12 months before its estimated delivery. Foot traffic is also improving downtown. Tourist visits to popular areas like the River Walk have returned to levels similar to 2019, while looking forward, companies like General Motors intend to bring the majority of workers back to the office at least on a hybrid schedule in 2023.