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11/27/24
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This report provided by CBRE
Denver ranks among the top North American tech markets for office leasing activity this year according to CBRE’s annual Tech-30 report.
Tech companies account for 21.4% of the office space leased in Denver thus far in 2024. Tech companies also took in 64.6% of venture capital funding in Denver during the first half of 2024 when approximately $1.1 bil was granted across 47 deals, with investments into companies focused on AI totaling $38.1 mil.
Denver also ranked highly for office rent growth. Denver’s 5.7% rent growth from last year’s second quarter to this year’s second quarter trailed only Boston, Baltimore and Nashville. Among the leading tech submarkets in each Tech-30 market, Denver’s Downtown submarket posted the fourth-largest rent growth, coming in at 5.8% for the same period of time.
“Companies in the tech industry view Denver as a place they want to be,” said Nic Weld, a Senior Vice President and local office expert at CBRE in Denver “Though our high-tech job growth has slowed, it remains positive, which cannot be said for over half of the markets highlighted in this report. This comes on the heels of 32.5% growth from 2019-2023 which made Denver the 4th fastest growing market for high-tech jobs among the Top 30. Given the highly technical nature of this industry, I anticipate a continued growth, supported by Denver’s well-educated population.”
CBRE’s Tech-30 report, now in its 13th year, measures the tech industry’s impact on office demand and rents in the 30 leading tech markets in the U.S. and Canada, as well as select submarkets.
In the U.S., the tech industry increased its share of office leasing activity to 18% in the first three quarters of this year, boosted in part by the growth of the artificial intelligence industry, according to CBRE’s annual Tech-30 report.
Tech notched a 3.8-percentage point gain so far this year from its 14.2% share of U.S. office leasing for all of 2023. The industry’s share so far this year exceeds that of the Finance & Insurance industry (16.5%) and the Professional & Business Services industry (15.7%). Tech had trailed both industries in 2022 and the first half of 2023 before reclaiming the lead in last year’s third quarter. It now has held its lead in five consecutive quarters.
In Canada, the tech industry claimed 15.2% of office leasing activity in this year’s first three quarters, up from a trough of 10.3% in 2023. Tech’s share in Canada trails that of Professional & Business Services (18.5%) and Finance & Insurance (16.8%).
Other notable details about Denver’s office market and tech job market in the report include:
• The High-Tech Industry in metro Denver was the 11th largest among the Tech-30 markets and accounted for 18.9% of office-using jobs in 2023.
• In the same year, there were approximately 102,762 high-tech software and services jobs in the metro.
• As of Q2 2024, the average asking rent for office space in metro Denver was $33.88.
• In the Downtown submarket, the top tech submarket in the city, the average asking rent was $41.90
• Over 50% of Denver’s residents had a bachelor’s degree or higher in 2023.
“The recovery of office markets across the Tech-30 will vary depending on each market’s concentration of tech-talent workers, extent of tech layoffs and local office-attendance policies, among other factors,” said Colin Yasukochi, Executive Director of CBRE’s Tech Insights Center in San Francisco. “Overall, several job market indicators and office market indicators point to growing momentum for the tech industry.”
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