The State of Commercial Real Estate in Metro Detroit: What Small Businesses Need to Know

For small business owners in Metro Detroit, commercial real estate remains a critical factor in business growth and operational stability. Whether you’re looking to open a brick-and-mortar store, expand an office, or relocate a warehouse, understanding market trends can help you make strategic decisions.

Current Trends in Metro Detroit’s Commercial Real Estate

The commercial real estate market in Detroit has been evolving, shaped by economic recovery, shifting work environments, and changing consumer behaviors. Here are some of the key trends affecting small business owners in 2025:

• Retail Spaces Are Bouncing Back – With increased foot traffic in revitalized areas like Downtown Detroit and Corktown, retail spaces are seeing renewed demand. However, vacancy rates remain high in some suburban areas.

• Office Leasing Is Still Uncertain – While some companies are returning to in-office work, hybrid models are keeping office space demand lower than pre-pandemic levels. This presents an opportunity for small businesses to negotiate flexible lease terms.

• Industrial Spaces Are in High Demand – The rise of e-commerce and logistics has driven up demand for warehouse and distribution centers, making these spaces more competitive and expensive.

How Rising Lease Prices May Affect Small Businesses

According to a recent report from CBRE, lease prices for prime retail and industrial spaces in Metro Detroit have increased by an average of 7% year-over-year, reflecting the growing competition for high-traffic locations. Meanwhile, office space prices have remained relatively flat due to ongoing uncertainty in the return-to-office movement.

These price shifts mean that small businesses need to be strategic when choosing their locations. Negotiating better lease terms, considering co-working spaces, or exploring secondary locations may help control costs.

Tips for Small Business Owners Navigating the Market

1. Leverage Economic Development Incentives – Detroit offers various grants, tax incentives, and funding opportunities for small businesses, especially those opening in redevelopment zones. Check out Detroit Economic Growth Corporation (DEGC) for available programs.

2. Consider Shared or Flexible Workspaces – If your business doesn’t require a full traditional office, coworking spaces like WeWork Detroit or Bamboo Detroit offer cost-effective alternatives.

3. Negotiate Lease Terms Carefully – With office demand lower than in previous years, landlords may be more open to negotiating rent reductions, lease flexibility, or tenant improvement allowances.

With so many changes and uncertainties relating to workspace and how we all approach our working environments, it's more important than ever to ensure you have a strong understanding of your business' true needs. 313 Growth can help you ensure that your workplace strategy is exactly what you need moving forward. Contact us today to schedule your free initial consultation!