Denver Office Vacancies Hit Record Highs, Defying Tech Boom Hopes

Denver's downtown office vacancy rate rocketed to 38.9% in the first quarter of 2026, an all-time high driven by a geographic and quality divide, according to CBRE data. Upper downtown's traditional central business district exceeds 40% vacancy, peaking at 46.4% in spots, while lower downtown hovers just above 20%, buoyed by the 2014 Union Station redevelopment that funneled billions into the transit-oriented neighborhood. Citywide, the metro area leaves nearly 9 million square feet empty as hybrid work reshapes demand, with overall vacancies at 15.7% — topping the 2003 Great Recession peak of 15.5%.

RiNo's office vacancy stands at 49%, contrasting sharply with the central business district's 32%, as submarkets diverge amid 13.4 million square feet of vacant office and retail space downtown — equivalent to eight Empower Field stadiums. Tech firms, a Denver staple, fuel the glut by downsizing footprints to slash costs without layoffs, dropping average lease sizes 45% from 2015 peaks; law firm Davis Graham & Stubbs exemplifies the trend toward efficient floor plans. Comcast's recent exit of 33,000 square feet near Union Station underscores uneven recovery, with more square footage vacated than leased in LoDo last quarter.

Class A trophy towers hold steady at 29-32% vacancy since mid-2024, luring tenants from aging Class B and C buildings now at 44.4% vacant — some fully empty. Sublease space has halved to 1.2 million square feet from pandemic highs, signaling stabilization, though new construction exceeding 1 million square feet since 2022 exacerbates the oversupply in Denver's 31.4 million-square-foot downtown inventory. The Downtown Denver Development Authority deploys capital for office-to-residential conversions and distressed buys, while state policies curbing oil and gas relocations add pressure.

Front Range peers fare better: Colorado Springs at 7.8%, Fort Collins at 4.6%, Boulder at 18.9% and Denver Tech Center at 18.3%, leaving downtown Denver with the highest rate among major hubs. Asking rents gap over $9 per square foot between direct and sublet space, with landlords slashing prices amid tenant leverage from record availabilities.