Microsoft Headed for Downtown Detroit
- Feb 07, 2017
Detroit—Microsoft Corp. is moving from the Detroit suburbs to the Motor City’s central business district. The tech giant recently signed a lease with real estate firm Bedrock for 40,000 square feet at the 1.1 million-square-foot One Campus Martius office tower downtown, where the company will relocate its Michigan Microsoft Technology Center.
There’s nothing like a big name to attract attention. “We definitely think that Microsoft coming downtown will bring Detroit to the forefront of business leaders who are looking for their next expansion or relocation,” Whitney Eichinger, director of communications with Bedrock, told Commercial Property Executive.
One Campus Martius, which Bedrock acquired with Meridian Health Plan for $142 million in late 2014, is already home to headlining tech companies, including Quicken and former building owner Compuware. Now, with Microsoft aboard, the 16-story landmark structure increases its status as a tech-friendly tower in a growing tech market. “Detroit is a rising city for innovation and technology. Microsoft is just one great example of the companies who are making Detroit a priority,” Eichinger added. Amazon is another; the e-commerce leader opened a tech center downtown at 150 W. Jefferson last year. And Microsoft’s commitment to Detroit’s CBD is nothing new. Months before the City emerged from bankruptcy in December 2014, Microsoft signed on for space in Bedrock’s Madison Building.
Downtown Detroit is making a comeback and the numbers tell the story. The direct vacancy rate for class A office properties was just 8.4 percent in the fourth quarter of 2016, compared to the national average of roughly 10 percent, per a report by commercial real estate services firm JLL. Just a single year has made a world of difference; the class A vacancy rate downtown in the fourth quarter of 2015 was 12.7 percent.
It’s not just the tech sector that’s revving up Detroit’s CBD office market. News over the last six months include Healthy Living Medical Supply’s announcement of a planned relocation from Troy to an 8,000-square-foot space at the historic Francis Palms Building, and Little Caesars’ commencement of construction of its new $150 million, 234,000-square-foot world headquarters. Additionally, at the end of 2016, global automotive seating supplier Adient acquired the 164,000-square-foot building at 243 W. Congress St. and revealed that it would invest $50 million to transform the property into its global headquarters.
Microsoft will relocate MTC from its current location at 1000 Town Center in Southfield, Mich., to One Campus Martius in early 2018. The company’s name will grace the building.
Image courtesy of Bedrock