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February 11, 2025
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Denver Metro Office Market Moving Toward Stabilization

1/28/25

Real estate services firm CBRE recently released its Q4 2024 office and industrial figures for the Denver Metro area. Below is a quick summary of the highlights from each of the reports.

Denver Office Figures Q4 2024

The Denver metro office market experienced a notable shift toward stabilization in Q4 2024. Positive total net absorption of 167k sf marked a considerable turnaround from previous quarters’ negative net absorption, while total vacancy was virtually unchanged at 24.9%.

Sublease availability continued its downward trend, decreasing 4.2% year-over-year to 5.6 msf.

Challenging fundamentals and capital markets conditions continued to impact the construction pipeline, with just over 600k sf under construction as of year-end 2024.

Leasing activity totaled 1.2 msf, a 16.8% decrease quarter-over-quarter but a 4.9% increase year-over-year, with the technology sector leading the way.

Investment activity in Denver metro improved after a slight decline in Q3 2024, recording 19 transaction and a sales volume of $277.4 mil compared to 13 transactions and a sales volume of $152.2 mil in Q3 2024.

Overall, the market’s outlook remains cautiously optimistic with signs of positive economic momentum in 2025.

Denver Industrial Figures Q4 2024

Total net absorption came in at positive 580k sf for Q4 2024, the second highest quarter of the year.

The good news is that new construction completions tapered at a similar pace, decreasing 52.2% compared to year-end 2023. The amount of sf under construction had been decreasing since the final quarter of 2023, but saw an increase in Q4 2024 with one 1.7 msf breaking ground. Of this total, 800k sf is a build-to-suit project.

Despite consistent positive net absorption and declining construction, direct vacancy still increased 20 bps compared to the end of 2023. After peaking in Q2 2024, direct vacancy fell 10 bps in both Q3 and Q4 2024, ending the year at 7.6%. Asking rents remained stable in Q4, but rose 5.2% year-over-year.

Leasing activity did well to keep up with supply as 12.6 msf of activity occurred in the year, with 65.8% of that total being new leases/expansions. This made 2024 the highest total for leasing activity since 2021, with the highlight of the year being BroadRange Logistics signing a new lease for 1.1 msf in Q3. Q4 2024 had 2.8 msf of total leasing activity.

Investment sales also had a strong year in 2024, surpassing 2023’s total volume by the third quarter. Q4 2024 was particularly active, with $644 mil in total transactions, well above any previous quarter in the year.

This report was prepared by:

Olivia Kozlowski
Research Analyst, CBRE

Nicole Zelener
Research Analyst, CBRE

Jonathan Sullivan
Research Manager, CBRE





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