Colorado-Real-Estate-Journal_515993

INSIDE Springs office PAGE 10 The Colorado Springs Class A office market demonstrated notable stability in 2025 March 2026 PAGE 19 PAGE 24 Industrial fundamentals Lack of supply coupled plus high demand is leading to positive Denver mkt. fundamentals Industrial outlook Denver’s industrial sector enters 2026 positioned for continued and steady growth I n the past two calendar years, New York City averaged 40 million square feet of office leasing (approximately 37 mil- lion sf in 2024 and 43 million sf in 2025), nearly doubling the 20.6 million sf recorded in 2020 during the height of the COVID-19 pan- demic. National headlines increas- ingly point to an “office recovery,” driven largely by activity in global gateway markets. In Denver, however, the rebound feels more measured. Overall avail- ability remains elevated, and while leasing activity has improved from pandemic lows, it remains uneven. Landlords, tenants and real estate professionals describe the market as stabilizing rather than surging. Historically, Denver has tended to follow markets like New York City during office cycles. Is that still the case, or is something different unfolding in this cycle? To assess whether Denver has truly “missed” the recovery, it is helpful to compare it not only to New York, but also to peer markets including Phoenix, Seattle, Salt Lake City and Austin, Texas. Are these markets experiencing a similar sta- bilization pattern? Looking across this broader set provides important context for under- standing the cur- rent cycle. During the COVID-19 pan- demic, every major U.S. office market experienced signif- icant disruption. Leasing declined sharply as companies paused decision-making, reassessed space needs and implemented remote work policies. From 2019 to 2020, leasing activity declined as follows: NYC -50% Denver -47.5% Austin -52.3% Phoenix -43.9% Seattle -25.1% Salt Lake City -34.7% San Francisco -66.2%. In relative terms, Denver’s decline was comparable to New York’s. The downturn was broad and largely synchronized across markets rather than isolated to one geography. However, scale amplified the effect in gateway cities. In a strong year, New York typ- ically leases more than 40 million sf. A 50% decline represents roughly 20 million sf of lost activity. Den- ver experienced a similar percentage decline, but the absolute volume shift was far smaller. That differ- ence in scale created more visible disruption in New York and, poten- tially, more visible upside as activity returned. Between 2021 and 2025, the con- trast has become more pronounced. New York has experienced pro- nounced leasing acceleration. Avail- ability has compressed from its peak, particularly in best-in-class product. Finance, legal and corpo- rate headquarters users have reen- gaged the market, and capital has flowed back into trophy assets. The result is a very visible rebound that has captured national attention. Denver (and other secondary mar- kets) tells a different story. Leas- ing rebounded in 2021 as tenants cautiously reentered the market, then leveled off in 2022 and 2023 before showing gradual improve- ment in 2024 and 2025. Availability has largely plateaued rather than sharply compressed. At first glance, Denver may appear to be behind New York. However, when compared to other secondary growth markets, including Phoenix, Seattle, Salt Lake City and Austin, Denver’s pattern is not unique. These markets are also stabilizing rather than surging. The 2008 financial crisis offers a useful comparison. Leasing activity declined and availability rose across all major office markets. However, in the years that followed, avail- ability compressed broadly across both gateway and secondary mar- kets. Denver, Phoenix, Seattle and other growth markets rebounded alongside New York in a relatively synchronized recovery. While New York’s scale made its movements more visible, the recovery was widespread. Please see Bante, Page 12 NYC is recovering, has Denver missed out? Greg Bante Executive managing director, Savills Rachael Deckys Senior research analyst, Savills