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Guidance Corporate Realty Advisors

COMMERCIAL TENANT AND BUYER REPRESENTATION

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Denver Commercial Real Estate Market Update

                                            OFFICE MARKET - 2nd Quarter 2010

The Denver Office market ended the second quarter 2010 with a vacancy rate of 14.2%. The vacancy rate
was down over the previous quarter, with net absorption totaling positive 604,095 square feet in the second quarter. Vacant sublease space increased in the quarter, ending the quarter at 1,577,160 square feet. Rental rates ended the second quarter at $19.94, a decrease over the previous quarter. A total of three buildings delivered to the market in the quarter totaling 521,049 square feet, with 741,139 square feet still under construction at the end of the quarter.

Office Absorption
Net absorption for the overall Denver office market was positive 604,095 square feet in the second quarter 2010. That compares to positive 976,949 square feet in the first quarter 2010, positive 552,861 square feet in the fourth quarter 2009, and negative (107,973) square feet in the third quarter 2009.

Office Vacancy
The office vacancy rate in the Denver market area decreased to 14.2% at the end of the second quarter 2010. The vacancy rate was 14.3% at the end of the first quarter 2010, 14.7% at the end of the fourth quarter 2009, and 14.8% at the end of the third quarter 2009.

Office Sublease Vacancy
The amount of vacant sublease space in the Denver market increased to 1,577,160 square feet by the end of the second quarter 2010, from 1,556,104 square feet at the end of the first quarter 2010. There was 1,736,174 square feet vacant at the end of the fourth quarter 2009 and 1,807,005 square feet at the end of the third quarter 2009.

Office Rental Rates
The average quoted asking rental rate for available office space, all classes, was $19.94 per square foot per year at the end of the second quarter 2010 in the Denver market area. This represented a 0.2% decrease in quoted rental rates from the end of the first quarter 2010, when rents were reported at $19.97 per square foot.

Total Office Vacancy and Leasing Rates* for key submarkets in the Metro Denver, Colorado area:

Submarket

Class

Vacancy

Avg. Lease
Rates/SF*
 Denver Central Business District A 15.1% $27.64
 Denver Central Business District B 13.6% $19.25
 Denver Tech Center (DTC) A 15.7% $20.77
 Denver Tech Center (DTC) B 21.7% $16.87
 West A 7.8% $21.39
 West B 12.5% $17.97
 Northwest A 19.9% $20.35
 Northwest B 13.4% $18.09
 Boulder A 7.2% $21.62
 Boulder B 9.3% $20.36

 *   Rates/square foot are full service gross, including all operating costs.
  

                                           INDUSTRIAL MARKET - 2nd Quarter 2010

The Denver Industrial market ended the second quarter 2010 with a vacancy rate of 8.2%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 1,750,105 square feet in the second quarter. Vacant sublease space decreased in the quarter, ending the quarter at 938,028 square feet. Rental rates ended the second quarter at $5.99, an increase over the previous quarter. A total of two buildings delivered to the market in the quarter totaling 767,624 square feet, with 101,699 square feet still under construction at the end of the quarter.
 
Industrial Absorption
Net absorption for the overall Denver Industrial market was positive 1,750,105 square feet in the second quarter 2010. That compares to positive 345,378 square feet in the first quarter 2010, positive 99,979 square feet in the fourth quarter 2009, and positive 416,053 square feet in the third quarter 2009.
 
Industrial Vacancy
The Industrial vacancy rate in the Denver market area decreased to 8.2% at the end of the second quarter 2010. The vacancy rate was 8.6% at the end of the first quarter 2010, 8.7% at the end of the fourth quarter 2009, and 8.7% at the end of the third quarter 2009.
 
Sublease Vacancy
The amount of vacant sublease space in the Denver market decreased to 938,028 square feet by the end of the second quarter 2010, from 985,857 square feet at the end of the first quarter 2010. There was 1,009,915 square feet vacant at the end of the fourth quarter 2009 and 1,004,343 square feet at the end of the third quarter 2009.
 
Rental Rates
The average quoted asking rental rate for available Industrial space was $5.99 per square foot per year at the end of the second quarter 2010 in the Denver market area. This represented a 0.2% increase in quoted rental rates from the end of the first quarter 2010, when rents were reported at $5.98 per square foot.
 
Source: The Costar Office and Industrial Market Report – 2nd Quarter 2010

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Guidance Corporate Realty Advisors provides Corporate Tenant / Buyer Representation services to corporate real estate users in the Denver metropolitan area including Boulder, Colorado.  Guidance also provides these services in all major U. S. markets, as well as markets in Canada, Asia, South and Central America, and Europe.  To contact: (303) 442-5400; Email for Information; 5330 Manhattan Circle, Suite G, Boulder, CO 80303; 5231 Monroe Street, Suite 200, Denver, CO 80216.
BOULDER OFFICE
5330 Manhattan Circle
Boulder, CO 80303		 DENVER OFFICE
5231 Monroe Street
Denver, CO 80216		 PH: 303.442.5400
FX: 303.545.6581
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