New Transwestern Report Shows RiNo Leads the Way with Continued Investment Interest
August 07, 2019
Denver – The Denver office market showed signs of slowing in the second quarter of 2019, likely attributed to tight employment metrics and declining job growth, according to Transwestern Commercial Services’ (TCS) Second-Quarter 2019 Office Market Report. Overall, the market still performed well, driven by high activity in the urban core and continued investment interest in River North, commonly called RiNo.
“The Denver office market continued to perform at a high level through the first half of 2019,” said Jared Balcavage, Research Analyst at TCS. “However, office demand throughout the metro continues to outpace development, which could prove to be troublesome for future corporate recruitment efforts.”
Highlights from the report include:
- Asking rates for all classes of space in the Denver metro totaled $28.96 per square foot over the quarter, a 2.2% increase year over year.
- Vacancy rates decreased by 20 basis points quarter over quarter, measuring 9.2%, and direct vacancy decreased by an impressive 11% year over year.
- The Denver metro development pipeline currently sits at more than 2.5 million square feet with nearly 40% of the development under construction located downtown.
- Demand for high-quality office space remains strong, and it is anticipated that vacancy will continue to decrease marketwide. RiNo will continue to drive construction activity as strong leasing volume in new developments will encourage further construction.
- Investment sales continue to decline with a 35% decrease year over year.
- Year-to-date absorption totals lagged during the first half of 2019, down 37% year over year as the market feels the pains of slowing job growth.
- A decreasing pipeline should promote development heading into the back half of the year. HUB North and Revolution 360 both broke ground in the second quarter.
- EverCommerce will occupy the remaining available space at HUB South after signing a 50,000-square-foot lease in the second quarter.
Download the full Second-Quarter 2019 Office Market Report at: https://transwestern.com/market-reports
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