Market Intelligence
Denver Commercial Real Estate Market Intelligence
The Denver commercial real estate market does not move as one piece. Office, industrial, retail and land each run on their own cycle, and downtown behaves differently from the suburbs. This is where we share how we read the market for clients, with dated, sourced numbers in each quarterly update.
Denver Commercial Real Estate Market Snapshot: Q3 2026
Metro Denver figures as of October 12, 2026. Source: CoStar.
| Metric | Office | Industrial | Retail |
|---|---|---|---|
| Vacancy | 17.8% | 9.2% | 4.4% |
| Avg. asking rent ($/SF/yr) | $31.13 | $11.69 | $27.65 |
| 12-month net absorption (SF) | 567,000 | (69,800) | 41,800 |
| Under construction (SF) | 954,384 | 5,475,379 | 1,639,994 |
Office
- Vacancy is 17.8%, near record highs, but the pace of move-outs has slowed and roughly half of Denver submarkets now show positive annual absorption.
- Flight to quality is the main theme. 4 and 5 Star buildings captured all of the positive net absorption over the past year, even with their own vacancy at 27.0%. 3 Star vacancy is 14.2% and 1 and 2 Star is 8.1%.
- Cherry Creek is the standout, with vacancy near 6%.
- Built-out sublease space trades at roughly a 30% discount to direct space, which keeps tenants in a strong negotiating position.
- The average office property sold for about $230/SF over the past year, down from a peak of $257/SF.
Industrial
- Vacancy is 9.2%, a two-decade high, and is not projected to peak until early 2027.
- Asking rents average $11.69/SF and are down 1.4% over the past year. Logistics averages $10.40/SF, specialized industrial $13.60/SF and flex $16.12/SF.
- Landlords are offering generous concessions and flexible terms, and many tenants are renewing in place.
- Construction has pulled back sharply, which should help space begin to tighten in 2027.
Retail
- Vacancy is 4.4% with availability at 4.9%, tight by historical standards.
- Asking rents average $27.65/SF, up 1.1% over the past year. Neighborhood centers average $25.94/SF and general retail $26.09/SF.
- Big-box closures caused the largest losses, while grocery-anchored and quick-service space has outperformed.
- Single-tenant net lease deals under $5 million, the most active segment, trade at cap rates in the low-5% range.
Figures are market-wide averages and vary widely by submarket, building and lease structure. For a specific property, we pull current comparables.
On this page
How We Read the Denver Commercial Real Estate Market
Headlines about the Denver commercial real estate market usually describe one property type in one part of town. For a decision about a specific building, we look at the numbers that apply to it:
- Vacancy and availability for that property type and submarket, including sublease space.
- Absorption: whether occupied space is growing or shrinking.
- Asking and achieved rents, plus the concessions landlords are giving to sign leases.
- Sale prices and cap rates from recent comparable sales, not asking prices.
- Debt markets: what lenders will finance, at what leverage and what cost.
- New construction that will compete for the same tenants or buyers.
What Is Driving Distress in Downtown Denver Commercial Real Estate?
Much of the stress in the downtown Denver commercial real estate market sits in older office buildings. The usual drivers are lower office use since remote and hybrid work took hold, tenants consolidating into fewer and newer buildings, and loans written in a lower-rate era coming due at higher interest costs. Buildings facing all three at once are where distress shows up first.
Distress creates opportunity for some buyers and real risk for owners. Our distressed asset advisory work helps owners and lenders think through the options.
Office, Industrial and Retail: Different Stories
In the Denver commercial real estate market, office, industrial and retail have followed different paths. Office demand has shifted toward newer, amenity-rich space. Industrial demand has been driven by distribution, e-commerce and trades, with performance varying between large distribution buildings and small-bay shops. Retail depends heavily on the specific center, co-tenants and neighborhood. Each quarterly update will cover all three with dated numbers.
Is It a Good Time to Sell Commercial Property in Denver?
There is no single answer for the whole Denver commercial real estate market. It depends on your property type, lease terms, debt, condition and what you would do with the proceeds. A stabilized industrial building with long leases faces a very different market than a half-empty older office. A broker opinion of value and a clear look at your alternatives answer the question for your property. See how we approach selling commercial property.
Quarterly Denver Market Updates
Each quarterly update on the Denver commercial real estate market will be dated and will cite its sources for vacancy, rents, sale prices and cap rates. We do not publish numbers we cannot source. For local planning and development activity, the City and County of Denver publishes zoning and permit information.
Common Questions
What is driving the distress in downtown Denver commercial real estate?
Mostly older office buildings facing lower office use after the shift to hybrid work, tenants moving to newer buildings, and loans coming due at higher interest costs. Not every downtown building is distressed; the pressure is concentrated where those factors overlap.
What is the average rent per square foot in Denver?
As of October 12, 2026, CoStar reports average asking rents across metro Denver of $31.13/SF for office, $11.69/SF for industrial and $27.65/SF for retail, per year. Rents vary widely by submarket, building class and lease structure, so we pull current comparables for your specific space.
What is Denver commercial real estate selling for per square foot?
Per CoStar, the average Denver office property traded at about $230/SF over the past year as of October 2026, down from a peak of $257/SF. Industrial and retail pricing depends heavily on building size, age, tenancy and location, so recent comparable sales for your property type and submarket are the right benchmark.
Is it a good time to sell commercial property?
It depends on your property, leases, debt and goals. Start with a broker opinion of value and a clear comparison of selling, holding and refinancing.
Want a Read on Your Property?
Tell us what you own or what you are looking for, and we will give you a straight read on the market for it.