DENVER – It’s no secret that Denver coworking space is experiencing explosive growth and Cushman & Wakefield’s Q3 Co-Working Report suggests that the Mile High City can expect the trend to continue in 2019.
According to the report, at the beginning of 2015, there was only 21,381 square feet of coworking space. Since then, more than 607,000 square feet of coworking space has been added with more than 117,000 already in the pipeline to open in 2019. Furthermore each year has added an increasingly larger amount with roughly 98,000 sf added in 2016, more than 158,000 sf added during 2017, 189,000 sf in 2017 and more than 206,000 SF YTD already in 2018.
Despite the fact that coworking currently accounts for only 2.7 percent of the total Class A & B inventory throughout Denver’s CBD, 96.6 percent of that has been added in just the past four years.
Coworking space is well-distributed throughout the Central Business District (CBD), but the largest portion is focused in the Midtown micro-market with nearly 319,000 square feet of space; more than double LoDo. This is largely due to two of the largest locations, WeWork Tabor and Novel Coworking/Level Office, calling the midtown micro-market home.
“Coworking growth within the CBD continues to accelerate, as companies benefit from the flexible terms and added benefits that are provided. As coworking continues to see occupiers from the everyday entrepreneur, to Fortune 500 companies utilize these spaces, growth will continue to spill-over into the Urban core, apparent by WeWorks’ 50k sf lease at the Hub,” says Mike Coppola, senior analyst, Denver Research at Cushman &Wakefield.
WeWork dominates the 745,291-square-foot market with a 51 percent share at 384,282 square feet, including their Wells Fargo location, scheduled to open in 2019. They have also embraced the
large coworking space model as even their smallest location exceeds the CBD average of 41,011 square feet.
So what’s driving the growth?
Cost is thought to be the greatest driver, coupled with the added amenities coworking spaces provide. Consequently small and large companies are weighing coworking facilities as a strong alternative during their search for real estate.
Denver is also attracting an increasing number of tech and startup companies and so as demand continues it would not be surprising to see the number of coworking spaces further increase.
