Denver Retail Market Report
By the Numbers
- SF Delivered: (29,447) ↓ from Q3 2024
- SF Absorbed: 391 ↓ from Q3 2024
- Sales Volume: $1B ↓ from Q3 2024
Denver Demographics
- Unemployment Rate: 4.1%
- Current Population: 3,042,364
- Households: 1,263,923
- Median Household Income: $102,315
Denver Retail Market Performance
An exceptionally low availability rate, limited new construction, and a resilient consumer base continues to benefit Denver’s retail market. Retail inventory has increased at the slowest rate of any major asset class in Denver, aiding in the restoration of market balance.
The metro’s average triple net asking rents have increased by 2.1% over the past 12 months to a record high of $26.00/SF. Over the past year, rents have increased for all retail categories, although some have done better than others. With an annual growth rate of 2.2%, neighborhood centers have experienced the strongest increase; meanwhile, strip centers have also reported impressive gains with an uptick of 1.7%. Approximately 180,000 square feet of retail space, or 0.1% of the total inventory, are presently being built throughout the Denver metro area. The present supply stream is unlikely to put pressure on vacancies in the foreseeable future due to high levels of preleasing.
Sales Velocity
In the past year, Denver’s retail investment volume amounted to $979 million. This marks the lowest annual figure since 2011 and is below the $1.3 billion 10-year annual average. While there was a significant decline in quarterly investment volume through 2022, investment activity has largely shifted sideways since early 2023 to around $200 million per quarter. In the current high-interest rate environment, the buyer pool has shifted predominately to small private investors who target single-tenant net-leased deals valued under $5 million.
Construction
Representing just 0.1% of Denver’s total inventory, roughly 180,000 SF of retail space is currently under construction across the metro. Only 8% of the space currently under construction is available for leasing. With high levels of preleasing, the present supply stream is unlikely to put pressure on vacancies in the foreseeable future.
