Denver’s retail sector has been flourishing and will continue to outperform in 2019 as vacancy rates continue to drop in our opinion. For the 10th year in a row, vacancy has been declining and sits at 4.4% in the Denver metro area. However, Downtown Denver has an even lower vacancy rate at 2.4% pushing rental rates steadily higher. In the metro area, the average rental rate rose to $19 per square foot, while downtown Denver is up 13.9% to $28.30 per square foot.
In an attempt to relieve some of the pressure, 1.5 million square feet of retail space is being constructed in downtown Denver, which may sound like a lot. However, if you compare this number to the already present 80.3 million square feet downtown, this is less than a 2% increase in space. According to Emerging Trends, Denver is the number one city that has lost the most retail square feet per capita from 2007-2018. Consequently, suburbs outside of the metro area are receiving attention from developers and national retailers, as we see new shops and restaurants popping up.