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Page 6 — Office Properties Quarterly — December 2017
Imagining new possibilities.
Creating lasting communities.
Commercial real estate with a proven past and future focus
MINNEAPOLIS DENVER
DEBT PLACEMENT | INVESTMENT ADVISORY| EQUITY PLACEMENT |FUNDS MARKETING |M+A & CORPORATE ADVISORY |LOAN SALES |LOAN SERVICING
HFF DENVER | 1125 17th Street, Suite 2540 | Denver, CO 80202 | (303) 515-8000
Holliday Fenoglio Fowler, L.P. (“HFF”) a licensed Colorado real estate broker.
CLOSED
Mainstreet at Flatirons
Property Sale
±93,657 SF Mixed-use: Office & Retail
Broomfield, CO
ON THE MARKET
1660 Lincoln
Property Sale
284,604 SF Office
Denver, CO
ON THE MARKET
Frontier Airlines Corporate Headquarters
Sale-Leaseback
89,021 SF Office
Denver, CO
ON THE MARKET
1331 17th St
Property Sale
220,287 SF Office
Denver, CO
I t is no surprise to Denver
residents that the city is earn-
ing widespread recognition
as an exceptional location for
businesses and the workforce
alike. Forbes ranks Denver as one
of “The Best Places for Business
and Careers.” Simply Hired chose
Denver as the “Best City for Tech-
nology Jobs.” NewsWatch recog-
nizes Denver as the “Best City for
Young Entrepreneurs.” U.S. News &
World Report ranked Denver as No.
2 in its “2017 Best Places to Live.”
The recognition of Denver’s appeal
is continual and widespread.
By many measures, Denver is
booming. The unemployment rate
in metro Denver dipped to 2.1 per-
cent in April, which was the lowest
of any metro area with 1 million
or more people, as reported by
the Bureau of Labor Statistics. In
fact, the unemployment rate has
declined an impressive 40 percent
over the last 12 quarters.
By contrast, the labor force has
increased by just 6 percent during
the same period,
which has con-
tributed, in part,
to the historically
low unemploy-
ment rate and our
limited labor avail-
ability.
The dramatic rise
in employment
is considered a
leading economic
indicator of the
commercial real
estate market and,
undoubtedly, has
strengthened office market funda-
mentals in Denver.
During the third quarter, rental
rates continued their upward
swing, vacancy rates further
declined and absorption was posi-
tive even with new construction
deliveries. All of this appears to be
– and generally is – good news. The
drawback comes into focus when
we evaluate the supply of available
employees.
A common contemplation of our
clients exploring Denver for expan-
sion or a new outpost is their con-
cern with filling open positions.
Denver has lost opportunities
to other cities such as Portland,
Oregon, Salt Lake City and Austin,
Texas, which offer similar attri-
butes to Denver but are less con-
stricted in terms of available labor
force. If Denver’s supply of labor
is unable to match employers’
demands to fill jobs, we will con-
tinue to lose employment oppor-
tunities as companies move else-
where, and this pattern will lead to
curbed growth in the commercial
real estate office sector.
Denver is the most educated city
in the country, our net migration
is more than double our natural
population growth, and we boast
the highest number of millennials
relocating here out of any other
metropolitan area in the U.S., as
reported by the Brookings Institute.
If the upward growth trajectory
in the office market is to be pre-
served and continued in Denver,
it is imperative these strengths
be leveraged to increase the labor
supply and to alleviate pressure on
companies considering growth in
Denver.s
Market Update
Liz Osborne
Managing director,
tenant advisory
group, Cushman &
Wakefield, Denver
The metro Denver unemployment rate has declined 40 percent over the last 12 quarters.
By contrast, the labor force has increased by just 6 percent during the same period.
If Denver’s supply of labor is unable to
match employers’ demands to fill jobs,
we will continue to lose employment
opportunities as companies move
elsewhere.