Savills Studley Releases Q1 2017 Office Market Report Findings for Denver
18 May 2017
Savills Studley, the leading commercial real estate firm specializing in tenant representation, has released its Q1 2017 Denver edition of the Savills Studley Office Market Report.
The quarterly report is an in-depth compilation of office leasing statistics and trends, major transactions, submarket comparisons, employment trends and investment and development trends specific to the Greater Denver area.
Highlights from the Q1 2017 Savills Studley Denver Office Market Report include:
- Despite strong demand, Greater Denver’s office market started off 2017 relatively slow with less overall sales and leasing activity from the previous quarter and relatively flat average asking rent fluctuations. However, as the Greater Denver availability rate tightened by 2.1% from Q4 2016, Class A availability rates in CBD, LoDo/Platte and Southwest submarkets each decreased between 3.2 and 9.7% from last quarter.
- While overall average asking rents appear flat, many tenants have seen effective rent increase as a result of a sharp spike in taxes and operating expenses. Last assessed in 2015, Union Station-area buildings now have combined operating expenses and taxes approaching $20.00/sf. The differential between tent in LoDo/Platte and Upton/Broadway sections of Downtown has widened by $5.00 to $8.00/sf, with the primary factors being taxes and special assessments.
- Short-term and long-term indicators show improvement in areas of the market that had been previously lagging. From Q1 2012 to Q1 2017, Greater Denver Class B & C buildings saw availability rates tighten from 21 to 15.1% and average asking rents climb from $17.88 to $23.54. After lagging in previous quarters, suburban Denver Class A leasing volume returned on par with its long term average at 708,752 sf in Q1 2017.
- New product set to deliver has renewed activity in the Southeast submarket. Three of the top ten leases in Q1 2017 took place in the Southeast, led by Charter Communications’ 256,000-sf transaction at Granite Place at Village Center. Combined with CSG’s 42,000-sf lease, the new building set to deliver later in 2017 is now fully leased.
The 2017 Q1 Savills Studley Denver Office Market Report, as well as a national report and reports for each of the 29 major U.S. markets can be found at www.Savills-Studley.com.
