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Page 12 — Office & Industrial Quarterly — March 2022 www.crej.com OFFICE — MARKET OUTLOOK D owntown Denver, as with many cities around the coun- try, is at a unique moment in our history.When the pandemic began in 2020, the common question if whether cities, after being left nearly empty in a mat- ter of days, would survive.What did the future hold? As we sit here two years later, it is clear that cities across the nation are not dead, including downtown Denver. Is it different? Sure.We see people thinking about public space, the office and community differently.We sit at a critical juncture where we, together, must shape a more vibrant, equitable city for generations to come. The Denver metro area has contin- ued to experience strong economic fundamentals throughout the pan- demic.While facing what experts are describing as the shortest recession in U.S. history, Denver was one of the few large metro areas that grew its labor force since March 2020, adding over 48,000 new workers. Simultane- ously, Denver has attracted residents to the center city, and the streets are coming to life as both restaurant din- ner reservations and vehicle traffic have nearly returned to pre-pandemic levels. Downtown Denver continues to top the list of key destinations and currently is enjoying an 80% return of visitor traffic from the low in March 2020, based on data from Placer.AI. But, as we look to re-enliven down- town Denver, we know that a return of employees to their offices is criti- cal. Pre-pandemic downtown Denver had 150,000 daily workers coming to their offices in the center city.While return to the office momentum feels slow, we continue to see Denver outpace many other cities. The Kastle Back to Work Barometer estimated a 31.6% return of employees across the country as of the second week of February, while our data in downtown Denver reflects a 35% return to work during the same time period. The Downtown Denver Partnership’s 2021 Travel Survey indicates that at least half of all sampled downtown employees visit their downtown office every day, and a majority consider flexible working hours to be the most important benefit their employer can offer. With additional companies announcing return-to-office plans daily, we continue to emphasize the value of face-to-face collaboration in the office and the unique experiences that can be afforded only by coming to your downtown place of work, while recognizing the shift in office culture that undoubtedly will continue to evolve along with our downtown. While employers may cut down on hours spent in the office, offices still are important places for collaboration, team building and connection – and will remain relevant for the foresee- able future. If the essence of going to work is shifting toward facilitating connection and social interactions to enhance employees’ quality of life, then downtown Denver is well posi- tioned to attract companies that aim to hire and retain the best talent in this competitive market. Downtowns have been – and will continue to be – places of connection and commerce that cannot be replicated elsewhere. Office vacancy was estimated at 14.8% nationally during fourth-quarter 2021, while the vacancy rate in down- town Denver for the same period was 16.7%, a number that mirrors the slower rate of recovery for cen- tral business districts as compared to suburban markets.While there likely will be some reduction in the demand for office space moving forward given the increased adoption of hybrid work models, we remain bullish that downtowns will continue to thrive as places where people, arts, culture and commerce come together and create a space where people want to be.We must invest in creating multifaceted, diverse downtown communities that attract residents, workers and visitors alike, reminding people what they love about downtown Denver. Other economic indicators show that downtown Denver is well poised for recovery and already on the way. A JLL Research report showed that the U.S. office market had a positive net absorption rate in the last quarter of 2021 for the first time since the start of the pandemic and noted that vacancy rates have been flat. Moreover, the DDP’s interviews with top lending institutions in downtown Denver in If you think downtown Denver is dead, think again CORENET COLORADO GOLF TOURNAMENT REGISTER - EZREGISTER.COM/EVENTS/36065/ Grab N Go Breakfast and Lunch Buffet Awards Ceremony Following Play CoreNet Colorado Mixer March 24th 4-6 PM Members: Free Non-Members: $40 Register - resources.corenetglobal.org Arrowhead Golf Club 10850 W Sundown Trail Littleton, CO 80125 SEPTEMBER 21ST | 8 AM MDT SHOTGUN 27 Total Foursomes Available $800 Per Foursome Register for CoreNet’s upcoming events CONNECT | GROW | LEARN | BELONG VIEW OUR UPCOMING EVENTS COLORADO.CORENETGLOBAL.ORG Bob Pertierra Senior vice president, economic development, Downtown Denver Partnership Jamie Rogers If the essence of going to work is shifting toward facilitating connection and social interactions to enhance employees’ quality of life, then downtown Denver is well posi- tioned to attract companies that aim to hire and retain the best talent in this competi- tive market. Please see Pertierra, Page 16