Marcus & Millichap’s Q4 2026 Denver Metro Area Industrial report highlights continued differences in leasing activity across the metro, with demand increasingly favoring newer, specialized properties and logistics-oriented locations.
While construction has slowed considerably, the continued relinquishment of older properties has kept vacancy elevated. Strong air freight activity at Denver International Airport (DIA) and demand from manufacturing, engineering and aerospace companies are helping support leasing activity across several industrial sectors.
Key findings include:
- Vacancy increased 60 basis points year over year to 9.3% in June. Conditions varied significantly by submarket, with Broomfield recording the highest vacancy rate at 25.9%, followed by Aurora at 17.9%. West Denver and Southwest Denver remained among the tightest markets, each with a 4.4% vacancy rate.
- Approximately 2.1 million square feet of industrial space is expected to be added in 2026, representing a 0.9% increase in inventory. Construction remains concentrated in the Southwest DIA/East I-70-Montbello and Centennial areas, with most projects consisting of warehouse and distribution facilities ranging from 100,000 to 300,000 square feet.
- Demand patterns differ across the metro. East I-70-Montbello and Northeast Denver continue to attract larger warehouse and distribution users near DIA and major freight routes. In Southeast Denver, more than half of leasing activity originated in the Centennial R&D corridor, where commitments averaged approximately 14,000 square feet, reflecting demand from smaller manufacturing and scientific users.
- Average asking rents are forecast to decline 2.8% to $10 per square foot by year-end. Rates vary considerably by location, ranging from $7.77 per square foot in East I-70-Montbello to $13.34 in Southeast Denver. Broomfield, West Denver and Southwest Denver also recorded average asking rents above $12.50 per square foot.
- Industrial investment activity has accelerated. Second-quarter 2026 sales volume exceeded $1 billion, nearly double the year-earlier level, while trailing 12-month volume surpassed $2 billion. Approximately two-thirds of first-half sales involved warehouse properties, many of which traded in East I-70-Montbello for between $120 and $150 per square foot.
- The metro is projected to add 4,000 jobs in 2026, representing 0.2% year-over-year employment growth. Although transportation and warehousing employment declined 3.2% year over year through August, payrolls in the sector remained approximately 17% above pre-pandemic levels. Growth in health care, leisure and hospitality, and government helped offset some of the weakness.
Access the report for additional market insights here.
