Denver Industrial Market Insights
In the coming year it will be tough to top the number – and magnitude – of significant events we experienced in 2018. Topping the list has to be the Prologis’ acquisition of DCT for $8.4 billion, which had a significant impact to our industrial landscape. Then there was Clarion’s acquisition of Gateway Park, owned by Pauls Corp, followed by Westfield’s development and sale of Hub25 to J.P. Morgan – all at eye-popping numbers. And what conversation would be complete without mentioning Amazon, which finalized their occupation of 4 Million square feet in four Denver warehouses over the last 18 months.
For the occupiers (tenants and private real estate owners) we provide advice and representation to, the landscape has been difficult. Landlords are looking for hefty base rate increases on lease renewals, property taxes are swelling operating expense budgets, and for those clients looking to buy—well, let’s just say that “sticker shock” applies in most cases.
It will be interesting to look back a year from now to see how the market performs. Will interest rates creep and a flood of new bulk and office/warehouse product coming on line cause a tap on the brakes? Or will job creation, which has averaged 45,000 new jobs per year in Denver over the last six years (over 50,000 projected for 2018!), continue to power us forward? One thing is for sure—this is an exciting time to live in Denver!
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