Parking and Affordability Push Tenants to East Boulder
BOULDER — According to CBRE’s Boulder Office Q4 2017 report, office space in the Boulder submarket continued to be in high demand in Q4 2017 as the number of active tenants in the market grew to more than 1.0 million sq. ft. but a lack of parking options and high lease rates are pushing some office users outside of downtown Boulder to areas like East Boulder.
The average direct asking lease rate in downtown Boulder was $40.46 per sq. ft. full service gross (FSG) in Q4 2017. Though the average rate for Class A space in downtown Boulder dropped 7.6 percent quarter-over-quarter to $42.45 per sq. ft. FSG, the rate remained the highest in all of metro Denver. By comparison, class A space in the East Boulder micromarket had an average direct asking lease rate of $27.51 per sq. ft. FSG- nearly $15.00 per sq. ft. less than the downtown micromarket.
According to the report, all construction activity for the quarter took place in the East Boulder micromarket, highlighting the increasing tenant demand for abundant parking and more affordable rates than downtown Boulder can offer.
More than 300,000 SF in new office space delivered in Q4, including the 200,000-sq.-ft. build-to-suit Google campus and Boulder Commons, a net-zero energy commercial development by Morgan Creek Ventures in East Boulder. The development is the most environmentally sustainable commercial design in all of Boulder County. As a net-zero building, Boulder Commons is the largest multi-tenant commercial project in the country to use net zero leases
S’Park, a 10.3-acre project that will feature residential, retail and office space broke ground on their two premier parcels – Timber and Market. Market will be a four-story 50,000-sq.-ft. mixed-use office building with a brewpub and retail space on the ground floor. Market is expected to deliver in Q3 2018.
Other projects under development include Canyon 28, a 42,000-sq.-ft. mixed-use building and the 40,000-sq.-ft. Iris Avenue Office Building. Both projects are anticipated to deliver in Q1 2018.