Detroit has had the opportunity to shine in recent weeks, first with the opening of the 2012 North American Auto Show and second in President Obama’s State of the Union Speech. The attention of the world’s media focused on domestic and foreign automakers who presented their latest creations for all to see. President Obama singled out Detroit as a success storey in his 2012 State of the Union speech declaring Detroit’s revitalization of its major industry a blueprint for other industrial cities. Once a punch line, now Detroit Takes Center Stage!
The news coming out of Detroit continues to be positive as the automotive industry continues to post gains as it proves that it can be competitive in both domestic and international markets. Introductions at the North American Auto Show by the domestic automakers prove that Detroit’s Big Three can produce cars that appeal to the public at large. The 2012 North American Auto Show attracted the highest attendance since 2005.
The Big Three are better integrating their platforms for new cars across their product lines to achieve better fuel economy, efficiencies, build quality and respond to customer demands. General Motors has shown that it can still be king of the hill by taking back the top spot as the largest automobile manufacture from Toyota which it lost in 2008. Celebrations have been muted since Toyota suffered from the earthquake in Japan early last year.
Michigan has benefited from these gains with an unemployment rate drop to 9.3 percent, lowest in more than 3 years. While the sales of existing home in Michigan fell slightly in 2011 while average sales prices rose modestly, there are signs of a second year of stabilization after several years of deep plunges. We are starting to see signs of improvement on the commercial real estate front as absorption rates albeit mild are heading in the right direction while rents in some cases are start to creep up.
As 2012 continues to progress, we are hopeful that the positive news on the automotive and employment front continue to be positive. In the mean time we will enjoy our time in the limelight as Detroit Takes Center Stage!
Matthew B. Fenster, CCIM, MCR