Denver Office Figures Q1 2023

- After three quarters of stalled activity, the development pipeline rose to 2.5 million sq. ft. after Steel House, a 297,000-sq.-ft project in the River North submarket, officially broke ground.

- Leasing activity softened in Q1 2023 with only 701,800 sq. ft. transacted, marking the first quarter since Q1 2021 with less than 1.0 million sq. ft. leased.

- Negative 250,500 sq. ft. of direct net absorption was posted in Q1 2023, a sizable dip from the negative 4,000 sq. ft. in Q4 2022 and the positive 251,900 sq. ft. seen a year earlier in Q1 2022.

- Investment activity in the first quarter of 2023 totaled $183.8 million ($318.32 price per sq. ft.), a considerable improvement from Q4 2022’s volume of $105.6 million.

- Total vacancy rose to 20.9%, an increase of 50 basis points (bps) quarter-over-quarter and 140 bps year-over-year. Direct vacancy increased to 17.7%, up from 17.4% in Q4 2022.

- Sublease availability increased 12.1% quarter-over-quarter and 51.8% year-over-year to 6.6 million sq. ft., marking the third consecutive quarter of record-breaking sublease volume.

- The overall average direct asking lease rate recorded nominal quarterly and annual changes, decreasing 0.2% quarter-over-quarter and increasing 0.5% year-over-year to $31.99 per sq. ft