Signature Associates

Struggles? Yes. But West Michigan office market still outperforming national averages

The West Michigan office market faces its challenges. But the fundamentals here are stronger than they are in many markets across the United States, according to the latest research from Colliers.

In its fourth quarter 2025 Grand Rapids office report, Colliers said that the West Michigan region — which includes the cities of Grand Rapids, Kalamazoo, Muskegon and Holland — ended 2025 with modest absorption and a slight drop in vacancy. Colliers said, too, that leasing activity persisted across core and suburban submarkets, while rents continued to climb amid limited new supply and cautious development.

Colliers reported that the office sector in the West Michigan region ended the year with an overall vacancy rate of 9.6%. That figure is down from 9.3% in the third quarter. The West Michigan region includes the cities of Grand Rapids, Kalamazoo, Muskegon and Holland.

The office vacancy rate here is well below the national average vacancy rate of about 14.1%. This highlights the relative stability of the West Michigan office market. The Cascade submarket remained the area with the highest vacancy rate at 16.6%, with a concentration of larger office blocks that have yet to be filled.

During the fourth quarter, the region’s office market recorded 53,000 square feet of net absorption, while 59,000 square feet of new office space was under construction. For the entire year, the West Michigan office sector notched 86,073 square feet of positive net absorption.

Colliers charted nearly 68,000 square feet of office leasing activity in the fourth quarter in the region, with notable deals in the CBD of Grand Rapids and in the Cascade and Southwest submarkets.

The overall asking lease rates for office space in the West Michigan office market stood at $23.37 a square foot as of the end of 2025, according to Colliers.

Despite some positive signs, the West Michigan office market remains muted when it comes to investment sales. Colliers said that investment sales hovered near $7.7 million in the fourth quarter. That is significantly below historical norms.

The most notable transaction in the quarter was the sale of Eaglecrest Office Park at 3355 Eagle Park Drive NE in Grand Rapids. That property sold for more than $2.35 million at $101 a square foot.

Construction remains down, too. Colliers reported that the only active office project in the West Michigan pipeline is 640 Leffingwell Avenue NE in Grand Rapids, a 59,000-square-foot building in the East Beltline submarket. This property should be complete in the third quarter of 2026.