Life sciences companies accounted for the largest chunk of all Denver-area office leases signed in 2023, taking roughly 611K SF, which put them at the forefront of an evolving market, new data from Avison Young shows.

The total number of leases signed by life sciences companies increased from 1.24% of leases signed in 2022, or about 170K SF of office space, up to 17% of leases signed in 2023, the data shows. Tech, meanwhile, accounted for 14% of office leasing last year.

The activity comes as Colorado officials seek to create incentives that help the industry expand its presence and life sciences companies continue to settle into the post-pandemic market.

Howard Schmidt, vice president of tenant representation at Avison Young in Denver, told Bisnow that Denver’s leasing activity suggests that the mix of industries using the city’s office spaces is changing. Different industries are coming back to the office at different rates.

“I was working with a hospice group touring around the market, and they work in the office five days a week. Meanwhile, I've got an insurance firm looking at a huge building, but they only come to the office twice a week,” Schmidt said.

“So it's just really dependent on those companies in this industry type and that culture.”

Schmidt added that new incentives announced by Gov. Jared Polis to expand Colorado’s life sciences industry could lead to more companies within the industry leasing Denver offices in the future.

On Feb. 12, Polis and local lawmakers announced a bill that would provide funding for a new College of Osteopathic Medicine at the University of Northern Colorado. The school would be the state's third medical school and could produce about 150 doctors per year.

Polis also announced plans to expand the Allied Health Program at Trinidad State University by about 50%, as well as expanding Colorado State University’s nationally recognized veterinary science program.

The funding is expected to help bolster the state’s healthcare workforce, which is estimated to need an additional 10,000 workers by 2026.