In Downtown Denver, you can literally get off an airline at Denver International Airport, take the train into the city and we are four blocks from Union Station.
2020 State of Downtown Denver
The 2020 State of Downtown Denver Report shows a vibrant and thriving city; a reminder of what can be accomplished and what the future of our Center City can be once again.
The 2020 State of Downtown is published in the midst of the global COVID-19 pandemic and subsequent economic recession, the likes of which have not been seen in nearly 100 years. At the time of publishing, economic data measuring this pandemic-induced recession is limited and often unreliable. Throughout the State of Downtown Report, we have taken measures to provide consistent, reliable and timely information. Wherever possible, we have provided the latest data points available. Read the full addendum at the end of the report for more information
Downtown Denver added 6,563 new jobs last year, resulting in record high total employment of 145,077. This 4.7% job growth was fueled by a host of new company locations and major expansions–13 announcements in total. Key employment sectors include Professional Services, making up nearly a third of all downtown employment; Technology and Innovation jobs now represent 9% of all downtown employment, doubling since 2010; and Oil & Gas, which remains a key component of the downtown economy, supplying 6.8% of the job mix.
Driven by demand for space from existing companies expanding (e.g. 2U, KPMG, Salesforce) and new companies moving to the market (e.g. Checkr) the downtown office market remained strong with stable average lease rates ($35.32 per square foot) and vacancy rates (10.3%). A positive 400,000 square feet was absorbed in 2019, bringing the total absorption in 2018 and 2019 to nearly 2 million square feet; however, net absorption in 2020 is projected to be negative for the first time since 2016. The office investment market reflected the strong performance, as existing players doubled down on their investments and new ones entered the market for a total of $1.4B in office investments.
We see Denver as an ideal real estate market to invest in. It’s a strategic location for domestic and international business, popular with millennials and supportive of a growing economy.
All roads–and trains and bus routes and bike lanes- -lead to Downtown Denver, as the center city is the hub of one of the nation’s most highly educated workforces. Top flight talent continues to call the Denver region home, with a fast-growing workforce that now tops 1.7 million people. The region also produces great talent each year, thanks to the 11 colleges and universities.
Development and Investment
Over the last 10 years, Downtown Denver has experienced a historic development cycle, adding over 4 million square feet of office, over 10,000 residential units, and over 3,500 hotel rooms. Investors continue to see the Downtown Denver opportunity, with 26 development projects under construction or planned – adding up to roughly 1.3 million square feet of office, 1,500 residential units, and 1,000 hotel rooms in the pipeline.
Denver is a vibrant and thriving city, and the ideal place from which to continue to grow our business across the west.
There are more mobility options into the center city than any other location in the metro area. Since 2013, the share of employees choosing to ride their bikes to work has doubled. Currently 9.2% of downtown commuters bike to work. And the city continues to make investments that support a multimodal transportation system in and around Downtown Denver; in 2019, the city began a rapid expansion of the bike network that will add 125 miles of new bicycle infrastructure to Downtown and nearby neighborhoods to make it safer and more convenient for commuters and residents to get around by bike. In fall 2019, one lane of 15th street and 17th street was converted into a bus only line, improving transit efficiency on two major downtown corridors. Finally, the G-line from Wheatridge to downtown opened in April 2019.
Population growth continues in Denver, and more and more of these new residents are choosing to live downtown and in center city neighborhoods. The most recent census estimates put the City of Denver at 727,211 total residents, a net increase of almost 11,000 over the previous year. Of this 11,000, about 60% came from net migration and 40% from natural increase. This continues a decade long trend of sustained population.
Retail & Restaurants
Retail sales, measured by retail sales tax collections, remained strong heading into 2020. Retail sales were 8.2 percent higher in 2019 compared to the prior year, the largest annual increase since 2014. Retail direct average lease rates were at $29.63 per square foot in Q1 2020, up 8.1 percent year over year and were significantly higher than the Metro Denver average of $18.26. Vacancy rates were also up slightly, rising 0.8 percentage points year-over-year in Q1 2020 to 3.5 percent. Downtown vacancy rates are still a full percentage point less than the Metro Denver vacancy rate of 4.5 percent. Much like their peers across the city, country, and worldwide, Downtown Denver’s restaurants and retailers will face significant challenges resulting from the COVID-19 crisis that is not reflected in these numbers. However, the success of 2019 and recent years provide hope for a successful long term recovery of the retail sector.
The public realm is where we get our first impressions of a city, where we experience social and economic interactions taking place between everyone on the street. From kayakers testing their river-boating skills in Confluence Park, to co-workers grabbing a beer for happy hour in Skyline Park, our public spaces Downtown offer a wide variety of experiences to everyone. Public space in Downtown Denver offers our residents, visitors, and employees over 150 acres of parks and open space as well as unique public spaces like the 16th Street Mall. Future investments in public amenities, such as the 5280 Trail, are sure to create even more outstanding public offerings in Downtown Denver.
Tourism is one of Denver’s top industries and economic drivers, accounting for more than 60,000 jobs in the metro area. And while Downtown Denver tourism enjoyed one of its most successful years ever in 2019, the industry has been disproportionately hard-hit by the COVID-19 pandemic. The closure of restaurants, museums and attractions, coupled with mass cancellation of concerts, festivals and events, means that nearly all of Denver’s demand drivers have been silenced. This has been paralleled in the meetings and conventions segment, which normally accounts for nearly $800 million in annual visitor spending, and has similarly ground to a halt.
This thriving aspect of downtown has been brought to sudden halt, and is waiting to rebuild.
The 2020 State of Downtown Denver was published in May 2020 in the midst of the COVID-19 pandemic and subsequent economic recession. At the time of publishing, much of the economic data typically used to measure the economic health of Downtown Denver (eg total employment, wages, retail sales) do not yet reflect the impact of the pandemic-induced recession. Throughout the State of Downtown Denver report, we have taken measures to provide consistent, reliable, and timely information. Wherever possible, we have provided the latest data points available. However, this does not tell the full story of the impact on downtown since the pandemic hit – or a full understanding of what’s to come.View the Addendum