Cushman & Wakefield: Five Fast Facts for Office & Industrial Markets in Denver

Cushman & Wakefield MarketBeat reports analyze quarterly economic and commercial real estate activity including supply, demand and pricing trends at the market and submarket levels.

Here are the Q2 market fast facts for Denver office and industrial:


The Denver metro office net absorption continues to trend negative with downsizing and tenant move-outs, however, asking rents remain steady at the end of Q2 2023.

  1. Unemployment Rate Remains Flat Despite Economic Concerns
    After falling 70 basis points in the Q1 2023, the Denver Metro unemployment remained unchanged in Q2 2023, ending June at 2.8%, well below the national average of 3.6%.
  2. Vacancy, Sublease Availability Falls SlightlyOverall vacancy decreased 20 basis points QOQ in Q2 2023, while sublease availability fell to 6.2 msf.
  3. Leasing Activity decreases in Second Quarter 2023
    The Denver Metro recorded just 1.4 msf of leasing activity in Q2 2023, a decrease of 21.8% compared to Q1 2023.
  4. Asking Rents Remain Steady
    Rental rate growth remained stable QOQ, ending Q2 2023 at an average rate of $31.84 per square foot (psf) on an overall basis. This represented a $0.18-psf increase QOQ and an $0.48-psf increase compared to Q2 2022.
  5. Net Absorption Continues to Trend Negative
    Absorption continues to be heavily impacted by downsizing and tenant move-outs, resulting in 1.5 msf of negative net absorption in Q2 2023, a decline from the negative 0.8 msf of negative absorption recorded in Q2 2022.


The Denver metro industrial construction pipeline continues to thin as speculative development slows and new construction deliveries create a slight uptick in vacancy in Q2 2023.

  1. Construction Pipeline Continues to Thin as Speculative Development Slows 
    Q2 2023 recorded 1.5 msf in deliveries and only 289,800 sf on new construction starts, bringing the under-construction total to approximately 8.5 msf. The volume of new speculative development is expected to taper off significantly over the next several quarters.
  2. Leasing Activity Experiences Strongest Quarter Since Q1 2022 
    After three consecutive quarters of decreased activity, the Denver market recorded 4.3 msf in leasing volume in Q2 2023, a 100.5% increase compared to Q1 2023.
  3. Delayed Move-ins Finally Commence, Giving Absorption a Boost 
    Following quarters of decreased absorption figures due to material shortages and build-out delays, Q2 2023 benefitted from several deferred move-ins, resulting in 1.2 msf of net absorption.
  4. Investors and Lenders Remain Selective, Leading to Decreased Sales Activity 
    Due to the rising interest rates and the subsequent cost of debt, investment activity remained comparatively light, with just under $104.0 million in investment sales in Q2 2023.
  5. Slight Uptick in Vacancy Due to New Speculative Construction 
    With 1.5 msf in new deliveries, 83.9% of which remains available, vacancy increased by 20 basis points QOQ on both a direct and overall basis to end Q2 2023 at 6.6% and 6.9%, respectively.

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