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Denver Office Market
2011 ended up being another relatively good year for the office market. Market fundamentals overall continue to improve as the vacancy rate continues its steady decline with another quarter of positive absorption. Rental rates have stabilized across the market and continue to press upward in select submarkets such as downtown, LoDo and in well located Class A suburban properties. The resurgence of strong activity in the southeast suburban submarket was a welcome sight as several large lease transactions were completed in the 4th quarter.
While leasing activity has continued to pick up momentum over the last several quarters, the real story of the quarter and the year itself was the return of the institutional investment market. Not only did several high-end properties exchange hands in both downtown and LoDo, but several other large institutional transactions took place throughout the market from Boulder, along the 36 corridor and quite a few more in the southeast suburban submarket. Institutional investors are more focused than ever on metro Denver as the local economy continues to recover, and 2012 should continue to see more investment sales from out of state buyers.
Another sign that the office market is headed in the right direction is the renewed marketing of several future developments, such a One Union Station in LoDo and 100 Saint Paul in Cherry Creek. All signs point to another strong year for Denver’s office market in 2012.
Transactions
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