During the pandemic, the need for Denver office space took a sharp decline. While many assumed it would stay that way, office leasing activity is almost back to pre-pandemic levels. This will increase annual absorption and the amount of occupied space in 2022.
Leasing volume reached over 8.5 million square feet in 2021, a 35% increase since 2020. Many tenants increased their desire for quality in their office space in the last year, which drove leasing activity. The aerospace and defense industry has been busy expanding in Denver’s southeast suburban corridor. Established, as well as up-and-coming tech tenants, make headlines closer into the urban core. Law firms have been especially active downtown as they look to attract and retain talent in a competitive labor market.
Companies are upgrading from their current spaces as they start to prioritize quality, location and safety in their offices. Hybrid work models have allowed companies to look for smaller spaces in higher quality buildings, significantly reducing their total cost.
Developers are certainly taking note of the trends that have arisen during the pandemic. Amid rising vacancies, historically high sublease inventories and stagnant rent growth, several high-profile buildings broke ground across the Denver metropolitan area in the last year. Developers are confident that these modern buildings, outfitted with the latest amenities, will be in high demand among prospective tenants.
Our team at Corken + Company has years of experience when it comes to commercial real estate services. If you are thinking about leasing you have come to the right place, let us help you today!