Much like the broader U.S. economy, Denver’s office market is displaying signs of turbulence, with indicators pointing in varying directions as 2022 comes to a close. Citywide, vacancy rates are lower compared to last quarter, yet three out of six submarkets recorded higher vacancy rates this quarter than the same time last year.

Similarly, only the West and Cherry Creek submarkets had higher average rental rates compared to last quarter. Building sales volume decreased in four out of six submarkets compared to last quarter, and in three out of six markets compared to Q4 2021.

Three markets, including Downtown Denver, Cherry Creek and Denver Tech Center, continue to see development, with a total of 2.2M square feet of office currently under construction.

Given continued return-to-office debates and national economic uncertainty, we will more than likely see continued turbulence over the next nine to twelve months. In spite of this, we remain bullish on Denver’s economy and the long-term recovery of the office market.

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