Only seven cities in the world had lower rates than Denver's $22.52 per sf for the Central Business District. Of the US cities in the bottom 10, Denver showed the largest percentage drop from the fourth quarter of 2000, at 12.4%.
Cities with lower rates than Denver are: Jakarta, $14.82 per sf; Kuala Lumpur, $19.75 per sf; Riverside-San Bernardino, CA, $19.98 per sf; Budapest, $20.22 per sf; Tampa, $21.30 per sf; and Pittsburgh, $22.36 per sf.
''It sounds like the '80s again,'' John Shaw, who heads Denver area office for Opus Northwest, tells GlobeSt.com.
However, there are huge differences this go-around.
For one thing, Denver's effective downtown lease rates have doubled in the past decade. Denver's low office rates gave the city a competitive advantage over many cities. Also, the spread between Denver and other cities is not as great as it was in the '80s and early '90s.
For example, Orlando ranked one place better than Denver, but its average rate was only $22.53 per sf, one cent more than in the Mile High City.
Perhaps even more important, Denver's rates are within 10% of many of the cities in the bottom half of the report.
And Denver didn't see the huge year-over-year drops of other, even more high-tech dependant cities. For example, the average lease rate in San Francisco fell by 51.3%, while San Jose saw its average lease rate plunge by 45.8%.
On the other hand, Denver's rates are a far cry from London, which at $149 per sf, has the highest office lease rates in the world, according to Grubb & Ellis.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
