Swisher Commercial’s annual office vacancy survey doesn’t track lease rates in Ann Arbor.

And regional reporting only looks at larger spaces.

Still, Ann Arbor area landlords and building owners agree: They don’t need precise data to know rental rates are falling - either as a flat rate or in the form of concessions - across the market.

And they don’t expect that to change this year as the overall office vacancy rate climbs to 17.62 percent.

“It’s still going to be a very competitive rental market,” said Bill Kinley of Phoenix Contractors. “And the farther you move from (the center of Ann Arbor), the worse it gets.”

Or, from the tenant perspective, the better it gets.

Today’s listings include office space in downtown Ann Arbor for less than $20 per square foot, though many premium buildings are holding their asking rates.

“People are being creative at making deals work,” said Mike Giraud of Colliers International in Ann Arbor.

That can mean dropping the asking rate. But more common, brokers said, is concessions.

For new deals, that can mean a shorter term than normally would be available, cutting the risk of a long term for both landlord (who won’t want to lock in a low rate) and tenant (who may not be comfortable locking in several years of payments).

Sometimes it’s “free rent,” or a period during the lease with no rent due.

And landlords who want to keep their tenants are responding to requests on a case-by-case basis to cut the lease rate.

For some businesses, that’s made enough of a difference to keep from cutting staff.

“You still have to offer value to people,” said Chris Grant of First Martin Corp. “You have to be reasonable and adjust to the market.”

What that means, he said: “When it comes time for a renewal, chances are the rent will be lower.”

In addition to generating the cash flow to cover expenses, occupancy of a building also affects its value when it comes time to sell or refinance.

The higher vacancy rates are an issue for owners who have highly leveraged buildings. And if they can’t cover their debt, lenders likely will be dealing with the shortfall.

Ann Arbor hasn’t seen many commercial foreclosures yet, but more lenders are dealing with commercial loan workouts.

In the meantime, many landlords are simply looking to cover their expenses if a qualified prospective tenant shops their building.

“No one’s looking to make a profit these days,” said Susan Shipman, managing director of Terzo & Bologna Inc., a Livonia-based commercial appraisal company. “They’re hoping to hold onto their building.”

Paula Gardner is Business Director of Ann Arbor Business Review at AnnArbor.com. Contact her by email or follow her on Twitter.