Denver Rents Spike as Vacancy Dips to Lowest Point Since 2015

According to Northmarq’s Q3 Multifamily Market Report, the Denver multifamily market is benefitting from a rapid rebound in the local economy with vacancies tightening, rent growth spiking, and absorption levels remaining high. Unprecedented renter demand in Denver in recent quarters has fueled significant rent growth in the last six months. Absorption levels to this point in 2021 have totaled more than 11,400 units, outpacing deliveries by 50 percent. This supply-demand imbalance has pushed vacancy to its lowest point since 2015, and the rate is expected to remain around this range for the next few quarters.

Multifamily investment activity in the Denver area accelerated during the third quarter as the number of transactions increased more than 20 percent from the previous quarter. Sales prices thus far in 2021 have pushed higher as the majority of properties that changed hands this year have consisted of newer, Class A properties as well as a number of Class B assets in suburban areas including Aurora, Arvada, and Thornton. Cap rates have trended lower in 2021, averaging 3.9 percent, reflecting positive investor sentiment.

A great example of this is Seagate Colorado Partners‘ recent acquisition of Outlook Clear Creek Apartments, a 310-unit multifamily property located at 4040 Clear Creek Drive in Wheat Ridge, for $142 million — a record high per unit sale price for suburban, wood-frame construction in metro Denver. Dave Martin and Brian Mooney of NorthMarq represented the seller, Evergreen DevCo, Inc.

“Outlook’s location enjoys a singular advantage as it straddles three of metro Denver’s most supply-constrained submarkets in Wheat Ridge, Golden, and Lakewood,” said Martin, adding, “Given their intimate knowledge of the market and local operational expertise, it was natural that Seagate saw the intrinsic value of this deal.”


  • The Denver multifamily market posted strong results in the third quarter, building on gains recorded during the second quarter. Absorption has been particularly strong, driving the vacancy rate to a six-year low and fueling steep rent increases.
  • Vacancy dropped 40 basis points to 4.5 percent during the third quarter. The rate is down 130 basis points year over year.
  • Rents rose nearly 7 percent during the third quarter, following an increase of more than 6 percent in the preceding quarter. At $1,734 per month, current rents are up 13.5 percent from one year ago.
  • Investment in multifamily properties in Denver continued to trend higher in the third quarter. Activity to this point in 2021 has doubled levels from the same period one year ago. The increased investor demand has caused prices to spike and cap rates to compress below 4 percent.
  • Following a decline in apartment deliveries during 2020, construction activity is expected to remain active through the rest of the year. Projects totaling approximately 11,300 units are forecast to come online this year, similar to annual totals in 2018 and 2019.


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