Broker Predicts Denver CBD's Trophy Space May Top Out at $40 Per SF

DENVER-The best space in top CBD offices could command lease rates as high as $40 per sf over the next two years. That’s the private, optimistic projections from landlords from some of Denver’s trophy office towers, says Scott Worrell, an associate director and office broker with Cushman & Wakefield Inc.

If they’re right, that would be a 60% increase from today’s average rate of about $25 per sf, which already is the highest average rate in more than 15 years, Worrell says. The $40 figure would not be typical, but for isolated cases for outstanding offices, he notes. But even that may be overly optimistic, he says, calling it a “pretty lofty goal.”

Worrell says there are at least seven office buildings on the drawing board–ranging in size from about 200,000 sf to close to one million sf–which would dramatically increase the supply. Although all of the office towers won’t be built, several of them will come on line during the next two years or so, he says. “There’s probably room for one big one and several small ones,” he says.