Metro Denver’s Commercial Real Estate is Booming
Metro Denver’s commercial real estate market has continued to expand this year, with new development and pre-leasing levels not seen in in more than 10 years. According to international real estate consulting firm Newmark Grubb Knight Frank, Metro Denver’s commercial space vacancy has declined for the 15th quarter in a row, down 1.4 percent from this time last year at 17.7 percent.
Contributing to this decline are new, high-rise office towers coming on the market downtown, major corporate tenants, such as McGraw-Hill, and the growing young professional demographic moving into the region.
Metro Denver was recently ranked No. 9 by Vocativ’s Livability Index of the best places for people 35 and under to live. Young professionals ages 24 to 35 choose to live in the metro region because of the access to mass transit, bike lane systems, and housing.
And with the re-development of Denver Union Station as the region’s transportation hub, which will eventually connect downtown to Denver International Airport, it’s no surprise that Metro Denver has become one of the hottest office markets in the nation.
Here are some of Metro Denver’s most recent commercial real estate projects and developments:
- Battery 621, a business incubator on Sixth Avenue and Santa Fe Drive, has developed a new creative office space project in the River North Neighborhood. The 120,000-square-foot workspace will house 350 to 400 professionals.
- Zeppelin Development, Inc. has also broken ground on a new office building in the River North neighborhood. The four-story, 60,000 square-foot space will cater to small entrepreneurial companies, midsize, and large companies seeking innovative workspaces.
- First Gulf Corp. unveiled plans for a 21-story office building on Lawrence Street. The new building will feature 290,000 square feet of office space with ground floor of 7,500 square feet of retail and 347 parking spaces. The Ontario-based company plans to break ground on the project in early 2014 and will include the new head office for Coca-Cola Canada.
- The Art, a $50 million, nine-story hotel has also broken ground in downtown Denver on West 12th Avenue and Broadway and will feature 165 rooms. The 165-room hotel is expected to be a key part of the Metro Denver’s cultural redevelopment, dubbed a "keystone" of the center's rebirth by Mayor Michael Hancock. The Art will also include 50,000 square feet of office space to fill the first three floors.
Denver also ranked eighth in a study by CBRE for its tech company growth and rental rate increases. According to the study, technology services employment in the Metro Denver area rose by 16 percent between 2010 and 2012 as tech companies leased up space for expansion.
Given the strong real estate happenings in Metro Denver, Newmark Grubb Knight Frank predicts that commercial rental rates in Metro Denver will exceed an all-time record by the end of the year.