Companies Moving To Denver Want To Be Near Public Transportation
Companies that are relocating or opening offices in Denver are coming for the young, educated workforce and want to be near public transportation.
But finding Class-A space in Lower Downtown, or LoDo, is tough, Cushman & Wakefield Executive Director Dave Johnson said.
“That’s why you’re seeing the development along 15th Street and 19th Street and in RiNo,” Johnson said.
Coming off a strong 2018, net absorption remained positive for the eighth consecutive quarter with about 600K SF absorbed through the first quarter of 2019, according to Cushman & Wakefield’s first-quarter Tenant Report. The healthy absorption is largely due to the addition of new inventory that delivered with 75% pre-leased, as well as WeWork continuing its aggressive growth throughout Denver. Metro Denver had six new projects deliver during the first quarter, bringing about 541K SF of new office development to the area.
Johnson points to projects that are in the works in the Central Platte Valley such as Platte 15, a 150,418 SF, five-story mixed-use building, and the Nichols Partnership’s One Platte, a 247K SF office building at 17th and Platte streets, as examples of developments that are within walking distance of Union Station.
LoDo has the highest average gross rental rate in the region at $45.32 per SF, compared with $34.46 in Cherry Creek, $25.78 in the southeast suburban market and $27.88 for the Northwest Corridor, according to the Tenant Report. But for new space, Cherry Creek, LoDo and RiNo all are commanding in excess of $50 per SF, Johnson said.
“The biggest factor for downtown is that people want to live closer to where they work,” Johnson said. “Denver has increased the amount of people living downtown dramatically over the last 20 years.”