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by Michelle Z. Askeland
As we wrap up 2016, the metro
Denver sublease market is still up,
but not earth-shatteringly so. How-
ever, experts are split on whether
2017 will bring relief.
Right now, downtown Denver has
roughly 1.4 million square feet of
available sublease space out of its
total 26.7 million sf of office space,
said Greg Holm, CBRE senior vice
president. The suburban southeast
Denver market has about 1 million
sf available out of its total 34.5 mil-
lion sf.
Any space that is under lease by
a master tenant that is being made
available to the market, typically at
a discount below the current market
rental rates, qualifies as sublease
space, said Matt Davidson, manag-
ing director with Newmark Grubb
Knight Frank.
It is also important to note that
sublease space can be qualified
in two forms – vacant and avail-
able, said Tom Lee, NGKF executive
managing director. Vacant space
is empty and physically available
today. Meanwhile, available sublease
space applies to companies that
are occupying space, but if some-
body would take their space, they
would move out, he said. According
to NGKF numbers, there is 890,000
sf of vacant sublease space in the
total market, with 506,000 sf of that
located downtown.
When discussing numbers, it’s
helpful to have historical com-
parisons. The sublease numbers are
down when compared to the early
2000s, at the end of the dot-com
bubble, said Lee. And in the south-
east suburban, the amount of vacant
space is half of what was available
during the Great Recession, he said.
If you compare the numbers with-
in the current cycle, they’re a little
high. Starting in 2010, the Denver
metro has gone from around 2 mil-
lion sf of sublease space down to
1½ million sf up to today’s high of
almost 3.5 million, said Holm.
“Right now, we have about 150 to
175 percent more sublease space
than we typically have, based on
the last seven years,” he said. But
it’s important to keep in mind that
there will always be some sublease
space available. If the long-term
average is somewhere in the range
of 600,000 to 700,000 sf downtown
and between 500,000 and 600,000
sf in the SES, and there currently is
The amount of total sublease space – available and vacant – is up in downtown Denver. Oil and gas companies represent much of this space.
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