Denver Commercial Market Trends – Q2 2026

The Denver Commercial Real Estate market saw a strong second quarter for sales during Q2 2026. The four major property types saw 473 sales during Q2 2026, which is greater than both the amount of sales during Q2 2025 (466) and during Q2 2024 (373). Year to date transaction volume for Q2 2026 is up 1.5% when compared to Q2 2025. This is driven by lower interest rates, relaxed lending standards, and increasing economic conditions.

The four commercial property types we are tracking are: retail, multi-family, office, and industrial. It is interesting to look at the Commercial Real Estate Market as a whole and the individual property types. Below is a summary of key details for each property type. Let’s dive into supply, demand, new construction, vacancy rates, and rent growth for Denver Commercial Real Estate.

Supply

There were 1,584 active & pending listings across the four major property types with 450 retail, 227 multi-family, 490 office, and 417 industrial. It is worth noting that the Denver MSA has 30,707 buildings totaling 902M SF of space. Most of the new construction continues to be in multi-family and industrial with retail continually growing by a modest amount. Let’s take a look at demand.

Demand

Demand for commercial space is created by people and businesses using the space. When our population is growing, there is an increased demand for housing and shopping. When jobs are created, there is more demand for industrial and office; however, office demand has been perpetually decreasing due to the rise of remote work.

There were 473 closed sales in Q2 2026, which is up from 466 closed sales in Q2 2025. As mentioned in the opening paragraph, this represents an increase of 1.5%. The total dollar volume for retail, multi-family, office, and industrial was $1.295B in Q2 2026 compared to $1.713B in Q2 2025, meaning there were more higher volume transactions that occurred in Q2 2025.

Another gauge for demand is net absorption. Absorption is a gauge of the space tenants need to live or operate their businesses. In Q2 2025, Denver absorbed 231,627 SF, but in Q2 2026, the commercial market saw over 5M SF of absorption! Out of this 5M SF in absorption, multi-family represented the bulk of it at 4,071,912 SF. All four property types gained occupancy in Q2 2026. Let’s take a look at new construction in the various property types.

New Construction

Developers started construction on 2.9M SF during Q2. This is up slightly from the 2.1M SF started during Q1 of 2026. Retail construction starts accounted for 414,942 SF. Multi-family construction starts were 1,531,400 SF. Industrial construction starts were 807,338 SF, and office construction starts were the least at 174,914 SF, which shouldn’t come as a surprise to many.

Another factor to consider is the total SF of space under construction. Retail has 1.2M SF under construction. Multi-family has 10.4M SF (12,951 units) under construction. This is a lot of apartments under construction given the rate of absorption and months of already existing multi-family supply, 7.79 months. Office has 761K SF under construction, and industrial has 6M SF under construction. All together, there is 18.4M SF of commercial real estate under construction in Denver.

Developers delivered just over 1.9M SF to the market in Q2 2026. This is relatively lower than Q1 2026 and Q4 2025. Retail delivered 106K SF. Multi-family developers completed 1.43M SF. Office delivered 248K SF, and industrial delivered 140K SF.

Vacancy Rates

A vacancy rate is a metric comparing the amount of unoccupied SF to the total SF of all the buildings in a market. Denver has 95.5M SF of vacancy for commercial real estate. Although this sounds like a lot, Denver has 902M SF of commercial buildings. Therefore, our commercial vacancy rate is 10.6%.

If we are to understand commercial vacancy rates, we need to compare the current vacancy rates to the long-term vacancy rates. Industrial properties are 2.4% higher than the long-term average. Multi-family is 3.1% higher than the long-term average. Retail is 1.1% below the long-term average, and office is 5.7% higher than the long-term average. Next let’s look at rent growth.

Rent Growth

Rent growth could be lumped into demand, but it is interesting enough to separate into a new paragraph. Compared to the CPI increase of 5% in Q2 2026, none of the commercial property types kept up with inflation, which erodes some value. Retail rents grew 1.95%, and office rents grew 1.42%. Multi-family and industrial rents both decreased at (2.28%) and (2.44%) respectively.

Final Thoughts

In summary, supply, demand, new construction, vacancy rates, and rent growth are all good key performance indicators for the commercial real estate market in Denver. We have a good supply of properties for sale. Demand for properties has increased slightly compared to Q1 2026 and relatively year-over-year compared to Q2 2025. Developers are hard at work building multi-family and industrial properties as well as more SF of retail space. We would argue developers are continuing to build too many apartments which will further push the current multi-family vacancy rate above the long-term vacancy rate and reduce future rent growth. Industrial rent growth also seems to be on a downward trend. Vacancy rates are different among the different commercial property types. Office vacancy has been consistently higher than the long-term average for several years now, mainly attributed to the rise of remote work after the COVID-19 pandemic. We expect office vacancy to stay higher for the foreseeable future.

Here is a link to the full presentation for each property type: