denver market · 4650 steele st upper north central 110,562 q3 19 city and county of denver - nai...

Denver Market

PREPARED BY

Dustin Ferguson

Certified General Appraiser and Owner

Industrial Market Report

INDUSTRIAL MARKET REPORT

Market Key Statistics 2

Leasing 3

Rent 8

Construction 10

Under Construction Properties 12

Sales 14

Sales Past 12 Months 15

Economy 17

Market Submarkets 19

Supply & Demand Trends 23

Rent & Vacancy 25

Sale Trends 27

Denver Industrial

9/17/2019Copyrighted report licensed to Ferguson Appraisals, LLC - 491941.

OverviewDenver Industrial

6.7 M 4.1 M 5.1% 4.2%12 Mo Deliveries in SF 12 Mo Net Absorption in SF Vacancy Rate 12 Mo Rent Growth

A confluence of events has resulted in Denver becomingone of the hottest industrial markets in the country.Robust demand in this regional market with a stronglocal economy is stemming from the growth of retailsales, employment, and industrial production in the metroarea and the greater Colorado region. Furthermore, theemergence of the marijuana industry's presence with thepassing of Amendment 64 in November 2012 created anadditional demand driver, with new and relativelyunsophisticated tenants operating with entirely differentprofit margins.

Overall, the market is uniquely strong. Industrial rents arearound 60% above the peak of last cycle, and rentscontinue to grow above the long-term average.However, rent growth continues to contract from thepeak years of this cycle, 2014-15, when the marketposted back-to-back annual gains of more than 9%.

Vacancies remain tight and significantly below thehistorical average, even if they have come off of thehistorically tight conditions that prevailed before recentsupply waves. Well over 5 million SF delivered in 2017,by far the most this cycle, and 3.3 million SF completed

in 2018. More than 4 million SF has come on linethrough August of this year with more than 4.5 million SFremaining in the near-term pipeline.

And the volume of speculative construction has neverbeen higher: The amount of available space at under-construction logistics properties (the warehouse anddistribution industrial subtypes) edged over 3 millionsquare feet in late 2018, twice the year-end 2017amount, and well above an earlier cyclical peak of 2.3million square feet in early 2016. That figure is downslightly this year, as some larger spec projects havedelivered.

Sales volume topped the $1.5 billion mark in 2018, anall-time high, while same-store industrial pricingincreased at an annual rate north of 10% for a fifthconsecutive year. Like many U.S. markets, Denver isexpected to see a moderation in both aforementionedcategories in 2019. It has become increasingly apparentthat more investors are taking a "wait-and-see"approach amid evolving trade tensions, fed rate policies,and global economic and political uncertainty.

KEY INDICATORS

Market RentVacancy RateRBACurrent Quarter Availability RateNet Absorption

SFDeliveries SF

UnderConstruction

$8.985.7%162,352,937Logistics 9.5% 970,055 2,342,474 2,852,194

$10.383.3%48,523,561Specialized Industrial 5.5% (98,267) 0 646,000

$13.364.5%33,871,389Flex 7.0% 106,702 37,000 606,966

$9.865.1%244,747,887Market 8.4% 978,490 2,379,474 4,105,160

ForecastAverage

HistoricalAverage

12 MonthAnnual Trends Peak When Trough When

6.0%6.7%0.9%Vacancy Change (YOY) 10.1% 2004 Q2 3.2% 2015 Q3

2,275,9292,349,7804.1 MNet Absorption SF 5,559,556 2014 Q2 (1,897,851) 2003 Q3

4,091,1272,835,1566.7 MDeliveries SF 5,483,628 2017 Q4 127,707 2011 Q4

2.0%2.9%4.2%Rent Growth 9.8% 2015 Q1 -4.8% 2003 Q3

N/A$682.3 M$1.4 BSales Volume $1.5 B 2018 Q4 $203.5 M 2010 Q1


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LeasingDenver Industrial

After plummeting to an all-time low of about 5% in mid-2015, the logistics availability rate has steadily trendedupwards, edging over 8% moving into the start of 2019.The uptick in the availability rate largely comes down toincreased levels of speculative development, which byseveral metrics is at cyclical peaks.

Over 80% of the pipeline is logistics space, comprised ofthe warehouse and distribution industrial subtypes. Therewas 3.1 million square-feet of available underconstruction logistics space early in first quarter of 2019,more than twice the year-end 2017 level, and nearly onemillion SF above an earlier 2016 peak. Tenants,particularly those in search of larger spaces have moreoptions (and in more parts of the metro) than they havehad in years.

The flex availability rate was right around 7% at the startof 2019, a new cyclical low. Speculative flexdevelopment remains minimal, and this segment of themarket looks poised for a continuation of tight conditionsin the near-term.

Demand has been concentrated in new big boxinventory, with Amazon leading the way. The ecommercegiant's entry into Denver was likely delayed bydisagreement over collection of state sales taxes. Thefirm began collecting sales taxes in the state in February2016, and opened a new 452,000 SF sortation center inthe Majestic Commercenter prior to the end of 16Q2.

In January 2017, Amazon announced plans to open a 1million SF fulfillment center in Aurora expected to employ1,000 people. That development delivered in September2017, and while it was under construction, Amazonannounced plans to build a highly automated fulfillmentcenter in Thornton on an 850,000 SF footprint. Thebuilding has three stories of usable space via largemezzanines, creating an effective square footage closerto 2.4 million. That fulfillment center opened in October2018.

In another bode of confidence in the Denver Metro,Amazon announced plans in 18Q3 to open up its firstphysical bookstore in the state of Colorado, taking thesole 5,000 SF retail unit in the upcoming Financial Houseoffice development in Cherry Creek.

The marijuana industry has been an important contributorto the industrial market, but the demand impact has beenconcentrated in the light industrial segment. With thepassing of Amendment 64 in November 2012, marijuanabecame legal in Colorado, (recreational sales began atthe start of 2014) and with the prior passing of House Bill1284 medical marijuana dispensaries were required togrow 70% of the product they sell, a threshold manyweren’t meeting before this legislation passed. As aresult, from 2013–15 grow facilities became an importantsource of demand in the market, with estimates of theirfootprint now between three million and four million SF.With caps on the number of producers and sellers, theyare no longer acting as a continued outsized demandcatalyst. These new business operations createddemand for more locally oriented and potentially olderproduct, as evidenced by the extraordinarily tight marketfor smaller warehouses. Grow spaces do not typicallyneed more than 5,000 to 20,000 SF, and low clearheights are not a problem.

The introduction of a new breed of tenants via marijuanalegalization created a demand shock on the order ofabout a 1.5% to 2% increase in occupied space. Whilenot a staggering number, the vast majority of thatdemand occurred in a narrow timeframe, around andbefore the start of commercial sales at the start of 2014.In a market that was already getting tight prior to thestart of 2014 (and where speculative development wouldnot take off in earnest until later in the cycle), this wasenough to squeeze the market to historically tightconditions, an environment where industrial owners hadunprecedented pricing power when leases came to term.


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NET ABSORPTION, NET DELIVERIES & VACANCY

VACANCY RATE


Page 4


AVAILABILITY RATE


Page 5


12 MONTH NET ABSORPTION SF IN SELECTED BUILDINGS

3rd QtrBuilding Name/Address Submarket Bldg SF Vacant SF

1st Qtr 2nd Qtr 4th Qtr 12 Month

Net Absorption SF

North Denver Ind 855,000 0 0 0 0 0 855,000Amazon

SW DIA/Pena Blvd Ind 353,500 0 0 0 353,500 0 353,500Southern Glazer's

DIA Ind 540,931 189,097 351,834 0 0 0 351,834Nexus at DIA

SW DIA/Pena Blvd Ind 508,428 198,466 0 0 309,962 0 309,962ProLogis Park 70

DIA Ind 266,240 66,626 81,629 0 117,985 0 199,61476 Commerce Center

SW DIA/Pena Blvd Ind 245,847 81,486 0 164,492 (131) 0 164,361Eastpark 70 (1)

SW DIA/Pena Blvd Ind 155,775 0 0 155,775 0 0 155,77518245 E 40th Ave

Northwest Denver Ind 145,000 0 145,000 0 0 0 145,0009675 W 108th Cir

SW DIA/Pena Blvd Ind 220,247 75,869 0 0 144,378 0 144,378Eastpark 70 (2)

SW DIA/Pena Blvd Ind 278,812 0 139,121 0 0 0 139,12120101 E 36th Dr

SW DIA/Pena Blvd Ind 199,410 0 0 0 117,283 0 128,84914200 E Moncrieff Place

SW DIA/Pena Blvd Ind 140,040 0 140,040 0 0 0 120,25113100-13300 E 38th Ave

Quebec St Ind 245,340 142,000 0 0 0 0 102,917Airport Industrial Center

West Denver Ind 104,380 7,195 98,980 1,500 (3,295) 0 97,1855770 McIntyre St

Centennial Ind 92,000 0 51,000 0 0 0 92,000HighField Business Park

SW DIA/Pena Blvd Ind 168,029 82,131 85,898 0 0 0 85,898Gateway Park IV East

Commerce City Ind 79,840 0 0 79,840 0 0 79,840Prologis Park Central

4,598,819 842,870 1,093,502 401,607 1,039,682 0 3,525,485Subtotal Primary Competitors

240,149,068 11,549,723 (62,376) 154,197 (61,192) 0 605,602Remaining Denver Market

244,747,887 12,392,593 1,031,126 555,804 978,490 0 4,131,087Total Denver Market


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TOP INDUSTRIAL LEASES PAST 12 MONTHS

Building Name/Address Submarket Leased SF Tenant Name Tenant Rep Company Leasing Rep CompanyQtr

18701 E 38th Ave SW DIA/Pena Blvd 289,113 Sealy Mattress Manufactu… JLL Newmark Knight FrankQ3 19

20900 E 36th Dr * SW DIA/Pena Blvd 287,148 Whirlpool JLL -Q4 18

19700 E 23rd Ave SW DIA/Pena Blvd 164,492 Bunzl Cushman & Wakefield CBREQ4 18

18245 E 40th Ave SW DIA/Pena Blvd 155,775 New Age Beverages Newmark Knight Frank Unique Properties, Inc.Q1 19

13100-13300 E 38th Ave SW DIA/Pena Blvd 140,040 Rocky Mountain Foods - Michael Bloom Realty…Q1 19

20101 E 36th Dr SW DIA/Pena Blvd 139,121 RK Mechanical Cushman & Wakefield Cushman & WakefieldQ1 19

3155-3199 S Platte River Dr * Lower South Central 135,779 Goodwill - Colliers InternationalQ1 19

13331-13333 E 37th Ave SW DIA/Pena Blvd 126,123 Howard Logistics - Michael Bloom Realty…Q2 19

14200 E Moncrieff Pl SW DIA/Pena Blvd 117,283 Beacon Sales JLL Newmark Knight FrankQ2 19

4650 Steele St Upper North Central 110,562 City and County of Denver - NAI Shames MakovskyQ3 19

11380 Reed Way Broomfield County 107,455 MKS Instruments, Inc. Newmark Knight Frank CBREQ3 19

5151 N Bannock St Northwest Denver 89,498 Sysco JLL -Q4 18

3503 N Windsor Dr SW DIA/Pena Blvd 85,253 Steelcase NAI Shames Makov… Majestic Realty Co.Q3 19

22700 E I-76 Frontage Rd DIA 81,773 Great Plains Moving & St… CBRE Newmark Knight FrankQ4 18

6150 Downing St Commerce City 79,840 Amazon - Cushman & WakefieldQ2 19

12900 E Smith Rd SW DIA/Pena Blvd 78,405 Believe Productions Newmark Knight Frank CBREQ2 19

4555-4685 Geneva St East I-70/270 74,978 - JLL -Q4 18

10432-10498 E 49th Ave East I-70/270 73,625 - - Newmark Knight FrankQ3 19

14550 E 38th Ave * SW DIA/Pena Blvd 70,080 Midwest Floor Coverings Inc Colliers International Cushman & WakefieldQ4 18

19900 E 23rd Ave SW DIA/Pena Blvd 68,510 Benjamin Moore - CBREQ4 18

6770-6880 Brighton Blvd * Commerce City 59,924 SRS Roofing - Newmark Knight FrankQ1 19

14603 E Moncrieff Pl SW DIA/Pena Blvd 57,142 GE Johnson Construction - CBREQ2 19

15755 E 32nd Ave SW DIA/Pena Blvd 54,600 US Venture Inc - -Q4 18

6030 Washington St Commerce City 54,317 CSC ServiceWorks, Inc. CBRE Cushman & WakefieldQ3 19

14501-14551 E Moncrieff Pl SW DIA/Pena Blvd 53,200 Highland Cabinetry - Colliers InternationalQ2 19

80 E 62nd Ave Northwest Denver 53,000 - - Ringsby RealtyQ4 18

14303 E Moncrieff Pl SW DIA/Pena Blvd 52,483 Grand Worldwide Logistics - CBREQ1 19

9650-9690 E 40th Ave * Quebec St 52,235 BSG Craft Brewery - Newmark Knight FrankQ3 19

8447 Highfield Pky Centennial 51,000 - - CBREQ4 18

4780 Vasquez Blvd Upper North Central 50,542 Elite Roofing Supply Lee & Associates | D… NAI Shames MakovskyQ1 19

14402-14492 E 33rd Pl SW DIA/Pena Blvd 50,050 Motion & Flow Products Unique Properties, Inc. Colliers InternationalQ4 18

12900 E Smith Rd SW DIA/Pena Blvd 50,004 - - CBREQ2 19

5775 Broadway Northwest Denver 49,749 - - Ringsby RealtyQ3 19

6490 E Smith Rd Quebec St 49,500 - - CBREQ1 19

12655 E 42nd Ave SW DIA/Pena Blvd 46,270 Freebird Unique Properties, Inc. CBREQ4 18

21055 Westgate Rd West Denver 46,071 Boulder Botanicals - Newmark Knight FrankQ1 19

6030 Washington St Commerce City 45,066 Gustave A. Larson Comp… CBRE Cushman & WakefieldQ4 18

17801 E 40th Ave SW DIA/Pena Blvd 44,400 Clark Equipment Company Cushman & Wakefield Cushman & WakefieldQ4 18

4525 Ironton St Cent E I-70/Montbello 41,770 Lucy Sky Dispensary - JLLQ2 19

3155-3199 S Platte River Dr Lower South Central 41,627 Goodwill - Colliers InternationalQ4 18

*Renewal


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RentDenver Industrial

Rents have skyrocketed this cycle: Moving into the startof 2019, rents had eclipsed last cycle's peak by nearly60%, behind only San Francisco and San Josenationally.

Today, conditions are still relatively tight, but developershave stepped on the gas. Supply additions in in 2017and 2018 were more than the prior five years combined.The amount of available under construction space didnot top 2.3 million SF this cycle through year-end 2017,but touched 3.2 million SF in 18Q4 alongside a rush oflarge groundbreaks. As supply has started to catch upwith demand, rent gains remain substantial but havemoderated, at least relative back-to-back escalations ofnearly 10% seen in 2014 and 2015.

Denver's outperformance against the national averagecomes in some part due to marijuana tenants, whichcreated a 1-2% demand shock in an extremely shorttimeframe, just as the market was already approachingcapacity (and before speculative development hadstarted in earnest). But Denver's strength also speaks to

a dynamic and growing local economy. Economic growthhas been trending upward since late 2017 (reversing athree year deceleration), in part due to an improvementin oil prices.

Moreover, Denver acts as the primary distribution hub forother front range metros that are seeing explosive growthin their own right, such as Fort Collins and Greeley,which have seen off-the-charts population and jobgrowth.

On average, logistics demand has soared by just over3% annually since 2012 (about two million SF per-year).Speculative development did not begin to hit the marketin earnest until 2016, and a historically tight marketgranted industrial owners with extraordinary pricingpower. While speculative development has providedsome relief for large- and medium-sized warehouse anddistribution tenants, tenants in search of smaller spacescontinue to face an environment with few options, andowners who will often retain an atypically high amount ofpricing power.

MARKET RENT GROWTH (YOY)


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RentDenver Industrial

MARKET RENT PER SQUARE FOOT


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ConstructionDenver Industrial

Development is at cyclical highs across several metrics.At the start of 2019, over 5 million SF was underway, upfrom a little over 3 million at the end of 2017.

Moreover, the volume of speculative development(virtually all of which is logistics space) has soared tonew heights. There was 3.1. million SF of availableunder construction logistics space early in 2019,following a string of major speculative groundbreaks in2018. This is about one million SF more available underconstruction logistics space than any point in the cycleprior to 2018.

Within this development upswing, two notable trendshave emerged.

First, developers are moving forward with fullyspeculative projects that are larger than what was typicalearlier in the cycle.

Second, major speculative developments are going upoutside of the East I-70/Denver International Airportcorridor, where much of the initial development this cyclewas concentrated.

The shift towards massive, fully speculative projectsbegan in earnest in mid-2017, when Majestic Realtybroke ground on building 15 at its 1,500-acre MajesticCommercecenter. Building 15, a 709,000-square-footdistribution center dubbed the ‘Big Bomber,’ is the largestspeculative logistics development ever constructed inDenver. The building remained fully available shortlyafter its June 2018 completion.

In 18Q3, Prologis broke ground on its largest speculativedevelopment to-date, a 508,000-SF distribution buildingat ProLogis Park 70.

Prologis, whose development this cycle prior to 2018 hadlargely been built-to-suits, separately broke ground onthree fully speculative buildings containing a combined630,000 square feet at a new industrial park calledProLogis Park Central.

Prologis Park Central is in Commerce City, close to the I-25/I-76 intersection. This ties into the second notable

development trend: Developers are moving ahead withprojects along I-25 and I-76—both immediately south ofthe I-25 intersection in Commerce City, and separatelyin far northeast metro Denver near the city of Brighton.With much of the land along the East I-70/DenverInternational Airport spoken for, the I-25 and I-76corridors may offer more-feasible developmentopportunities for new entrants.

In April 2018, Minneapolis-based Hyde Developmentbroke ground on the first 266,000 square-foot building atthe I-76 Commerce Center development in Brighton,located in an enterprise zone. That fully speculativebuilding is the first phase of a planned 1.8 million square-foot industrial park, by far the largest development of thisnature in the Brighton area.

Geographically, development in northern Metro Denverand along the I-76 corridor makes sense. Whilesomewhat further removed from population centers inMetro Denver, immediate proximity to I-25 grants accessto the fastest growing corridor of the Colorado FrontRange. Namely, Metro Denver’s northern suburbs housesome of the fastest growing cities in the metro.

And just north of Metro Denver, growth is robustthroughout the Northern Colorado I-25 corridor. Citieslike Firestone, Erie, and Frederick (just north of MetroDenver in far southwest Weld County) each sawpopulation growth exceeding 22% over the past fiveyears. Vast amounts of open land and significantongoing residential construction prime this part ofColorado for a continuation of outsized growth.

Another nearly untouched part of the metro is about tosee a speculative development: In September 2018,Santa Monica, CA-based Cale Enterprises announcedplans to imminently break ground on two buildings(59,000-SF and 82,000-SF) in Arvada, near theintersection of Ridge Rd and Robb St. The developmentwill be the first larger speculative project in this part ofthe metro in over 15 years, and is expected to completein the third quarter of 2019. The buildings will be divisibledown to about 10,000 SF, a lower threshold than muchof what has been constructed this cycle.


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ConstructionDenver Industrial

DELIVERIES & DEMOLITIONS

SUBMARKET CONSTRUCTION

Average Building Size

RankUnder Constr

Under Construction Inventory

All ExistingSF (000) Pre-Leased SF (000)SubmarketNo. RankBldgs Pre-Leased %

1 SW DIA/Pena Blvd 6 1,272 211,95945.5% 5 92,971578 3

2 DIA 4 910 227,5600% 7 40,6760 2

3 North Denver 3 371 123,6230% 7 35,1940 7

4 West Denver 2 301 150,500100% 1 41,758301 5

5 Centennial 2 265 132,700100% 1 38,623265 6

6 Outlying Arapahoe Cty 1 250 250,000100% 1 68,432250 1

7 East I-70/270 1 209 209,0780% 7 43,2270 4

8 Broomfield County 2 188 93,881100% 1 31,768188 8

9 Northwest Denver 2 142 71,0900% 7 27,0090 9

10 Southwest C-470 1 50 50,0001.4% 6 20,9411 10

All Other 5 107 21,37741.8% 23,76645

Totals 29 4,065 140,17840.0% 31,4361,628


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Under Construction PropertiesDenver Industrial

31 4,247,264 2.0% 42.6%Properties Square Feet Percent of Inventory Preleased

UNDER CONSTRUCTION PROPERTIES

UNDER CONSTRUCTION

Property Name/Address Rating Bldg SF Stories Start Complete Developer/Owner

Mar-20192400 E 64th St

Karcher N America380,000 - Dec-2019

SunCap Property Group

Karcher North America, Inc.1

Sep-201922600 E I-76 Frontage Rd

Building 4352,240 1 Apr-2020

Hyde Development

Hyde Development2

Aug-2019112th Avenue & Highway 85

Building D330,250 1 Jun-2020

Brennan Investment Group

Brennan Investment Group3

Aug-201818701 E 38th Ave

Tower Business Center…289,113 1 Oct-2019

United Properties

United Properties4

Jan-201812257 S Wadsworth Blvd

Lockheed Martin266,000 - Apr-2020

-

Lockheed Martin Corporation5

Jan-201823505 E 6th Ave

J.P. Morgan Chase Data…250,000 - Feb-2020

-

JPMorgan Chase & Co.6

Aug-20195303 Havana St

Prologis Park Stapleton…209,078 1 Nov-2020

Prologis, Inc.

Prologis, Inc.7


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http://gateway.costar.com/Gateway/Redir/RedirectToProduct.aspx?productId=PPW&redirUrl=%2Fredir%2Fdefault.aspx%3Feid%3D11018006%26ProductMode%3DProperty%26external%3D1







Under Construction PropertiesDenver Industrial

UNDER CONSTRUCTION

Property Name/Address Rating Bldg SF Stories Start Complete Developer/Owner

Mar-201926100-26120 E 68th Ave

JAG Logistics Center at…188,000 1 Feb-2020

J.A. Green Development

J.A. Green Development8

Mar-20191910 N Gun Club Rd

163,790 1 Nov-2019Karis Capital LLC

Karis Capital LLC9

Jun-201816205 Sheridan Pky

152,761 3 Oct-2019McWhinney

Broomfield Economic Developme…10

Apr-2019900 E 128th Ave

151,668 1 Oct-2019The Opus Group

The Opus Group11

Sep-2019S Chambers Rd

147,183 1 Aug-2020The Opus Group

The Opus Group12

Aug-201913575 E 37th Ave

142,104 1 Jan-2020Karis Capital LLC

AEW Capital Management13

Aug-201818901 E 38th Ave

Tower Business Center…133,848 1 Oct-2019

United Properties

United Properties14


Building B121,275 1 Jun-2020



Aug-2019S Chambers Rd

118,216 1 Aug-2020The Opus Group

The Opus Group16

Apr-20192115 N Scranton Way

Bioscience 3117,000 3 Nov-2019

Fitzsimons Life Science District

Fitzsimons Life Science District17

May-2019W 144th & I-25

Building 1114,700 1 Mar-2020

United Properties

United Properties18


Building A106,475 1 Jun-2020



Apr-2019W 144th & I-25

Building 2104,500 1 Mar-2020

United Properties

United Properties20

Aug-2019Ridge Rd & Robb St

Mountain Gateway82,470 1 Jun-2020

Cale Enterprises Llc

City of Wheat Ridge21

Aug-2019Ridge Rd & Robb St

Mountain Gateway59,710 1 Jun-2020

Cale Enterprises Llc

City of Wheat Ridge22

Dec-20185391-5399 S Alkire Cir

Building 5-750,000 1 Dec-2019

Ojala & Company

Ojala & Company23

Dec-20186281 S Racine Cir

40,000 1 Oct-2019-

Smith & Smith Property Ventures,…24

Feb-20195495 W 6th Ave

Coated Metals35,000 1 Mar-2020

-

-25

Feb-20192364 Industrial Ln

35,000 - Feb-2020-

-26

Apr-20195285 Joliet St

Leopold Bros. Malt House30,000 3 Oct-2019

-

Leopold Brothers27

Jul-201918540 Apache Dr

27,753 1 Mar-2020-

-28


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SalesDenver Industrial

Around $1.8 billion in industrial sales were recorded inMetro Denver in 2018, eclipsing the previous all-timehigh by 50% Same-store industrial pricing increased bymore than 10% for a sixth straight year in 2018. Cap ratecompression has slowed, but average yields are stilltrending fractionally downwards.

Investment in 2018 was headlined by large multi-property and portfolio deals. This includes New York,NY-based Clarion Partners' March 2018 acquisition of26 industrial properties from Pauls Corporation for $345million. Those properties included 14 (almost two millionSF) in the Denver metro, all located along I-70 near theDenver International Airport. The Denver propertiestraded for an allocated $220 million as part of the largerdeal, representing the largest industrial transaction in themetro's history.

In a notable 18Q2 trade involving recently deliveredlogistics space, J.P. Morgan Investment Managementacquired the four-building 421,000 SF Hub 25 industrialcampus for $74 million, or $176/SF—some of the highestpricing ever recorded in Denver for larger logistics space.Construction on the development wrapped up in 2017,and the buildings were roughly 95% occupied at the timeof the sale. HUB 25 is located just south of theintersection of I-25 and I-76, an area beginning to see

explosive growth. Nearby, ProLogis recently brokeground on a multi-building campus containing just over600,000 SF, all of which is speculative.

The most notable single-asset trade of the year waslikely the October 2018 sale of the largest industrialbuilding in the metro, a 1.3 million SF distribution centerin Brighton. Sears occupies about 150,000 SF at thebuilding, which was formerly entirely occupied by Searsand Kmart prior to significant downsizing. Sears stillretains its lease on the whole building, however, and asof yet hasn't worked to lease or sublease the more than1 million SF of currently unused space.

The building was acquired by Newport Beach, CA-basedStarboard Realty Partners for $41 million ($31/SF), whichcited the expectation of demand growth along the I-76corridor. Weeks after the deal closed, Sears would go onto file for Chapter 11 Bankruptcy protection. While Searsmay continue to operate in some capacity for a time, it'soutlook even one year out is highly uncertain. That andthe fact that over one million SF at the building iscurrently unused, along with a new owner expecting areturn on its investment, brings a high likelihood thatmost or all of this building will hit the market sometimeover the next year.

SALES VOLUME & MARKET SALE PRICE PER SF


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Sales Past 12 MonthsDenver Industrial

525 7.0% $111 8.7%Sale Comparables Avg. Cap Rate Avg. Price/SF Avg. Vacancy At Sale

SALE COMPARABLE LOCATIONS

SALE COMPARABLES SUMMARY STATISTICS

Sales Attributes Low Average Median High

Sale Price $146,134 $4,084,881 $2,236,046 $40,750,000

Price Per SF $4.94 $111 $141 $673

Cap Rate 4.4% 7.0% 7.0% 12.0%

Time Since Sale in Months 0.2 6.5 6.9 12.0

Property Attributes Low Average Median High

Building SF 685 31,876 14,625 1,305,700

Ceiling Height 8' 16'8" 16' 36'

Docks 0 4 0 100

Vacancy Rate At Sale 0% 8.7% 0% 100%

Year Built 1878 1976 1975 2019

Star Rating 2.1


Page 15

Sales Past 12 MonthsDenver Industrial

Property Name - Address Rating Yr Built Bldg SF Vacancy Price Price/SF

Property

Sale Date

Sale

Cap Rate

RECENT SIGNIFICANT SALES

-1 18875 E Bromley Ln1994 1,305,700 0% $40,750,000 $3110/2/2018 10.0%

-2 Building 222019 419,060 100% $38,553,500 $92

18100 E 40th Ave6/7/2019 -

-3 Smith Road Commerce…2016 290,147 67.2% $28,000,000 $97

12900 E Smith Rd12/20/2018 -

-4 PESCO Building2016 112,966 0% $22,000,000 $195

6144 N Panasonic Way7/11/2019 5.6%

-5 Central 62 Distribution C…2017 124,000 0% $21,325,000 $172

435-495 E 62nd Ave10/1/2018 4.4%

-6 16200 Table Mountain Pky1998 227,500 0% $20,050,000 $8812/27/2018 6.2%

-7 Building 232019 184,040 100% $18,956,100 $103

18000 E 40th Ave6/7/2019 -

-8 2555 W Midway Blvd1981 363,582 0% $18,750,000 $526/20/2019 -

-9 Bldg 22007 161,524 0% $17,951,950 $111

2460 Airport Blvd5/20/2019 -

-10 7103 S Revere Pky1983 58,405 0% $16,890,000 $2891/14/2019 7.6%

-11 INOVA Dry Creek Flex2017 71,172 0% $16,100,000 $226

7304 S Joliet St10/12/2018 6.3%

-12 Bldg 12001 103,565 0% $15,700,000 $152

11575 Main St8/6/2019 -

-13 Staples Distribution1980 185,000 0% $14,361,575 $78

13800 E 39th Ave9/28/2018 -

-14 5120 Race Ct1972 124,500 0% $14,137,212 $1144/1/2019 7.1%

-15 10949 E Peakview Ave1986 86,020 0% $14,027,499 $1631/28/2019 -

-16 Highfield Building 62018 92,000 0% $13,080,263 $142

8447 Highfield Pky8/29/2019 -

-17 50 S Kalamath St1960 214,991 98.6% $13,074,074 $616/25/2019 -

-18 W. 60th Place & Broadway1984 69,096 0% $13,000,000 $188

301 W 60th Pl3/14/2019 -

-19 5175 Joliet St1979 119,983 0% $12,847,040 $1071/28/2019 -

-20 13705 Compark Blvd2014 63,882 0% $12,800,000 $20010/17/2018 7.2%


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EconomyDenver Industrial

Although Denver’s overall employment growth has shownsigns of a slight slowdown along with the national index,the greater Denver area is adding tech jobs at anaccelerating pace. Employment in Professional, Scientific& Technical Services grew by more than 8% year-over-year as of July, a new high watermark for the cycle.Corporate expansions and relocations by tech companiessuch as Amazon, Slack, and Conga are drivingemployment gains as the war for talent rages on in ahistorically tight U.S. job market.

Denver has been frequently lauded as a destination foryoung, educated job seekers throughout this cycle, andcurrent labor conditions reinforces this proposition today.Headwinds could come from housing costs, which aredramatically higher today for both renters andprospective owners. While home prices continue to climbinto the stratosphere (albeit at a slower rate than thepeak years of this cycle), apartment rent growth hasmoderated alongside elevated levels of construction,which may provide a relief valve for those consideringthe metro for its otherwise robust employment prospects.

Along with a young, highly educated, and growing laborforce, the FasTracks transit expansion is expected to paydividends as additional lines connect downtown to NorthDenver, Aurora and the Denver International Airport, allin addition to an expansion to the southeast rail line.Healthcare, a major growth sector for years to come, isseeing major investment in the $1.3 billion VA hospital inAurora, the Denver Health Administration’s newheadquarters in South Midtown, and Catalyst’s 300,000-SF digital health facility in RiNo (Platte River Submarket).

Geographic isolation remains an economic liability insome respects. The geographic separation from largebusiness and financial centers makes locating acorporate headquarters here difficult for companies thatbenefit from proximity to suppliers, competitors,financiers, and customers, although firms that draw onDenver’s natural resources and brainpower have thrived.As a result, the metro has had to rely on its own brand ofspecialization in high-value-add industries likeengineering, energy, communications, and high tech todrive growth.

DENVER EMPLOYMENT BY INDUSTRY IN THOUSANDS

NAICS Industry Jobs LQ MarketUS USMarketUSMarket

Current Jobs Current Growth 10 Yr Historical 5 Yr Forecast

-0.03%0.24%0.99%1.10%1.22%-0.13%0.570Manufacturing

0.44%0.98%1.22%1.94%0.94%1.71%1.0278Trade, Transportation and Utilities

0.36%0.77%0.89%1.66%0.02%0.68%0.9140 Retail Trade

0.33%0.41%1.06%1.70%0.91%-1.59%1.3110Financial Activities

0.75%1.03%0.03%1.36%0.47%-1.17%0.9199Government

0.19%1.02%2.37%3.99%2.82%2.07%1.3112Natural Resources, Mining and Construction

0.54%0.87%2.11%3.48%2.07%2.76%0.8194Education and Health Services

0.94%1.42%2.70%3.40%2.21%3.39%1.3284Professional and Business Services

0.56%0.21%0.11%1.12%-0.73%-0.86%1.850Information

0.58%0.75%2.53%3.08%2.47%0.27%1.0171Leisure and Hospitality

0.27%0.88%1.01%2.46%1.30%4.92%1.062Other Services

Total Employment 1,529 1.0 1.33% 1.50% 2.50% 1.50% 0.93% 0.53%

Source: Oxford Economics

LQ = Location Quotient


Page 17

EconomyDenver Industrial


YEAR OVER YEAR JOB GROWTH

DEMOGRAPHIC TRENDS

Current ChangeCurrent Level

Metro U.S.Metro U.S.Demographic Category

10-Year Change

Metro U.S. Metro U.S.

Forecast Change (5 Yrs)

Population 329,455,7812,969,633 1.2% 0.7% 1.7% 0.7% 1.3% 0.7%

Households 121,306,5861,132,054 1.1% 0.5% 1.6% 0.6% 1.2% 0.6%

Median Household Income $63,950$81,511 3.1% 3.3% 3.2% 2.3% 4.2% 4.4%

Labor Force 163,586,9221,676,732 1.3% 1.0% 1.9% 0.6% 0.9% 0.5%

Unemployment 3.6%3.2% -0.1% -0.3% -0.5% -0.6% - -


POPULATION GROWTH


LABOR FORCE GROWTH INCOME GROWTH


Page 18

SubmarketsDenver Industrial

DENVER SUBMARKETS


Page 19


SUBMARKET INVENTORY

12 Month Deliveries Under Construction

Bldgs SF (000) Percent Rank

Inventory

Bldgs SF (000) Percent RankBldgs SF (000) % Market RankSubmarketNo.

1 Arapahoe Rd 45 0% 35 0 - - -4 0 0 0% -

2 Aurora 2,428 1.0% 20 1 25 1.0% 13104 1 25 1.0% 14

3 Broomfield County 4,988 2.0% 16 2 188 3.8% 8157 2 247 5.0% 7

4 Cent E I-70/Montbello 18,132 7.4% 4 1 30 0.2% 11331 0 0 0% -

5 Centennial 10,969 4.5% 9 2 265 2.4% 5284 8 407 3.7% 5

6 Clear Creek County 125 0.1% 32 0 - - -9 0 0 0% -

7 Commerce City 13,031 5.3% 6 1 12 0.1% 15519 4 688 5.3% 4

8 Denver Tech Center 26 0% 37 0 - - -1 0 0 0% -

9 DIA 9,396 3.8% 13 4 910 9.7% 2231 4 830 8.8% 3

10 East Hampden 146 0.1% 30 0 - - -8 0 0 0% -

11 East I-70/270 19,020 7.8% 3 1 209 1.1% 7440 2 45 0.2% 11

12 Elbert County 158 0.1% 29 0 - - -18 0 0 0% -

13 Gilpin County 22 0% 38 0 - - -4 0 0 0% -

14 Glendale 2,643 1.1% 19 0 - - -150 0 0 0% -

15 Greenwood Village 7 0% 39 0 - - -1 0 0 0% -

16 Highlands Ranch 1,776 0.7% 23 0 - - -50 3 345 19.4% 6

17 Inverness 2,408 1.0% 21 0 - - -54 0 0 0% -

18 Lakewood 126 0.1% 31 0 - - -13 0 0 0% -

19 Lower Central 8,311 3.4% 15 0 - - -353 0 0 0% -

20 Lower North Central 9,693 4.0% 12 0 - - -438 0 0 0% -

21 Lower South Central 8,520 3.5% 14 0 - - -547 1 0 0% 17

22 Meridian 700 0.3% 27 1 28 4.0% 1240 1 2 0.3% 15

23 Mid Central 4,282 1.8% 18 0 - - -272 1 30 0.7% 13

24 Mid South Central 1,311 0.5% 25 0 - - -120 0 0 0% -

25 North Denver 10,065 4.1% 10 3 371 3.7% 3286 5 965 9.6% 2

26 Northwest Denver 14,558 5.9% 5 2 142 1.0% 9539 3 161 1.1% 9

27 Outlying Adams Cnty 65 0% 34 0 - - -8 0 0 0% -

28 Outlying Arapahoe Cty 753 0.3% 26 1 250 33.2% 611 0 0 0% -

29 Outlying Douglas Cnty 37 0% 36 0 - - -4 0 0 0% -

30 Park County 92 0% 33 0 - - -14 0 0 0% -

31 Parker/Castle Rock 1,405 0.6% 24 1 12 0.9% 14118 2 31 2.2% 12

32 Quebec St 11,270 4.6% 7 0 - - -276 1 1 0% 16

33 Southeast C-470 1,789 0.7% 22 0 - - -84 0 0 0% -

34 Southwest C-470 11,078 4.5% 8 1 50 0.5% 10529 0 0 0% -

35 SW DIA/Pena Blvd 37,282 15.2% 1 6 1,272 3.4% 1401 12 2,626 7.0% 1

36 Upper Central 441 0.2% 28 0 - - -39 0 0 0% -

37 Upper North Central 9,925 4.1% 11 0 - - -432 2 48 0.5% 10

38 Upper South Central 4,469 1.8% 17 0 - - -339 0 0 0% -

39 West Denver 23,176 9.5% 2 2 301 1.3% 4555 5 225 1.0% 8


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SUBMARKET RENT

Growth

Market Rent

Per SFSubmarketNo.

12 Month Market Rent QTD Annualized Market Rent

RankRank GrowthRank

1 Arapahoe Rd 1.8%9 3.8% 20$14.16 36

2 Aurora 3.5%24 4.0% 15$10.92 16

3 Broomfield County 2.5%28 3.6% 32$10.44 22

4 Cent E I-70/Montbello 6.3%39 4.9% 4$7.05 3

5 Centennial 4.0%15 4.2% 11$12.39 11

6 Clear Creek County 2.0%4 4.5% 6$15.04 29

7 Commerce City 4.0%32 4.3% 8$9.92 10

8 Denver Tech Center 1.6%1 3.7% 25$17.00 37

9 DIA 4.8%33 4.5% 7$9.85 6

10 East Hampden -10.8%7 -1.9% 39$14.21 39

11 East I-70/270 5.5%36 4.6% 5$8.39 4

12 Elbert County 2.0%23 3.5% 36$11.02 30

13 Gilpin County 2.0%16 3.6% 31$12.17 33

14 Glendale 2.9%20 3.9% 17$11.80 19

15 Greenwood Village 2.0%8 3.8% 21$14.18 34

16 Highlands Ranch 2.0%10 3.8% 24$14.00 31

17 Inverness 2.1%11 4.0% 16$13.45 26

18 Lakewood 2.0%18 3.8% 22$11.89 32

19 Lower Central 4.1%34 4.0% 12$9.60 9

20 Lower North Central 3.5%27 3.9% 19$10.52 14

21 Lower South Central 3.3%29 3.6% 29$10.25 18

22 Meridian 2.2%3 3.3% 38$15.17 25

23 Mid Central 2.9%21 3.6% 30$11.14 20

24 Mid South Central 2.1%19 3.5% 37$11.83 28

25 North Denver 16.3%22 5.1% 2$11.07 1

26 Northwest Denver 3.7%30 4.2% 10$10.11 12

27 Outlying Adams Cnty 2.5%31 3.7% 26$9.93 23

28 Outlying Arapahoe Cty 4.4%26 4.0% 13$10.60 8

29 Outlying Douglas Cnty 2.1%5 3.8% 23$14.60 27

30 Park County 2.0%12 3.7% 27$13.15 35

31 Parker/Castle Rock 3.5%2 3.6% 28$15.64 15

32 Quebec St 5.3%37 5.0% 3$7.89 5

33 Southeast C-470 3.6%13 4.2% 9$12.77 13

34 Southwest C-470 2.4%14 3.6% 33$12.62 24

35 SW DIA/Pena Blvd 7.3%38 5.3% 1$7.40 2

36 Upper Central 0.6%6 3.5% 34$14.56 38

37 Upper North Central 4.5%35 4.0% 14$9.53 7

38 Upper South Central 3.3%25 3.9% 18$10.75 17

39 West Denver 2.7%17 3.5% 35$12.16 21


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SUBMARKET VACANCY & NET ABSORPTION

12 Month Net Absorption

Rank Construct. Ratio

Vacancy

SF % of InvSF PercentSubmarketNo. Rank

1 Arapahoe Rd - - -0 0% --

2 Aurora 154,516 6.4% 0.545,699 1.9% 1024

3 Broomfield County 506,756 10.2% -(12,269) -0.2% 3326

4 Cent E I-70/Montbello 762,134 4.2% -(336,848) -1.9% 3916

5 Centennial 632,184 5.8% 1.2320,970 2.9% 423

6 Clear Creek County - - -295 0.2% 22-

7 Commerce City 730,880 5.6% 6.2110,029 0.8% 722

8 Denver Tech Center - - -0 0% --

9 DIA 381,121 4.1% 1.3616,398 6.6% 314

10 East Hampden - - -1,246 0.9% 20-

11 East I-70/270 475,232 2.5% -(218,569) -1.1% 386

12 Elbert County 7,725 4.9% -3,977 2.5% 1918

13 Gilpin County - - -0 0% --

14 Glendale 18,302 0.7% -45,460 1.7% 112

15 Greenwood Village - - -0 0% --

16 Highlands Ranch 362,627 20.4% 8.540,555 2.3% 1329

17 Inverness 71,633 3.0% -12,739 0.5% 1710

18 Lakewood - - -0 0% --

19 Lower Central 385,298 4.6% -(6,529) -0.1% 3217

20 Lower North Central 254,761 2.6% -87,059 0.9% 88

21 Lower South Central 182,220 2.1% -(55,696) -0.7% 374

22 Meridian 2,585 0.4% -14,283 2.0% 161

23 Mid Central 166,444 3.9% 2.114,542 0.3% 1513

24 Mid South Central 31,441 2.4% -(12,829) -1.0% 345

25 North Denver 679,043 6.7% 0.91,042,799 10.4% 225

26 Northwest Denver 601,859 4.1% 3.348,187 0.3% 915

27 Outlying Adams Cnty - - -0 0% --

28 Outlying Arapahoe Cty 37,333 5.0% -9,158 1.2% 1819

29 Outlying Douglas Cnty - - -0 0% --

30 Park County 2,387 2.6% -(115) -0.1% 317

31 Parker/Castle Rock 155,754 11.1% -(52,916) -3.8% 3628

32 Quebec St 603,907 5.4% -143,759 1.3% 620

33 Southeast C-470 58,847 3.3% -42,196 2.4% 1212

34 Southwest C-470 297,787 2.7% -(39,731) -0.4% 359

35 SW DIA/Pena Blvd 3,811,664 10.2% 1.32,028,447 5.4% 127

36 Upper Central - - -0 0% --

37 Upper North Central 540,120 5.4% 59.6804 0% 2121

38 Upper South Central 136,357 3.1% -25,228 0.6% 1411

39 West Denver 341,676 1.5% 0.8212,759 0.9% 53


Page 22








































Supply & Demand TrendsDenver Industrial

OVERALL SUPPLY & DEMAND

Net AbsorptionInventory

% of Inv Construction RatioSF SF Growth % Growth SFYear

2023 2,581,812 1.0% 0.8%2,070,363 1.2258,420,546

2022 2,905,177 1.1% 0.9%2,253,131 1.3255,838,734

2021 3,183,596 1.3% 0.9%2,361,417 1.3252,933,557

2020 3,988,990 1.6% 0.8%2,047,166 1.9249,749,961

2019 6,157,286 2.6% 1.1%2,696,204 2.3245,760,971

YTD 5,144,202 2.1% 1.0%2,565,420 2.0244,747,887

2018 3,166,206 1.3% 1.3%3,040,966 1.0239,603,685

2017 5,178,724 2.2% 2.2%5,195,917 1.0236,437,479

2016 4,088,713 1.8% 1.0%2,247,986 1.8231,258,755

2015 1,733,191 0.8% 0.9%1,933,383 0.9227,170,042

2014 2,797,906 1.3% 2.5%5,544,040 0.5225,436,851

2013 (1,500,319) -0.7% 1.3%2,976,973 -222,638,945

2012 716,658 0.3% 1.6%3,480,543 0.2224,139,264

2011 (28,861) 0% -0.3%(766,833) -223,422,606

2010 305,522 0.1% 0.7%1,668,129 0.2223,451,467

2009 585,040 0.3% -0.2%(467,024) -223,145,945

2008 3,212,973 1.5% 0.4%919,441 3.5222,560,905

2007 2,960,831 1.4% 2.3%5,066,472 0.6219,347,932

SPECIALIZED INDUSTRIAL SUPPLY & DEMAND



2023 126,531 0.3% -0.2%(103,069) -49,631,797

2022 142,438 0.3% -0.1%(25,594) -49,505,266

2021 156,025 0.3% -0.1%(26,685) -49,362,828

2020 688,573 1.4% 0.1%37,068 18.649,206,803

2019 87,594 0.2% -0.2%(109,808) -48,518,230

YTD 92,925 0.2% -0.2%(110,173) -48,523,561

2018 29,539 0.1% 0%411 71.948,430,636

2017 (199,629) -0.4% -1.1%(545,988) -48,401,097

2016 (65,620) -0.1% 0.1%33,103 -48,600,726

2015 (75,410) -0.2% 0.4%181,334 -48,666,346

2014 (70,748) -0.1% 0.3%157,065 -48,741,756

2013 (2,423,469) -4.7% -1.3%(652,250) -48,812,504

2012 89,446 0.2% 0.6%286,390 0.351,235,973

2011 71,300 0.1% -1.0%(529,519) -51,146,527

2010 0 0% 0.3%158,809 051,075,227

2009 5,280 0% 0.8%386,797 051,075,227

2008 (24,313) 0% -0.9%(474,688) -51,069,947

2007 10,060 0% 1.6%821,869 051,094,260


Page 23

Supply & Demand TrendsDenver Industrial

LOGISTICS SUPPLY & DEMAND



2023 2,312,013 1.3% 1.3%2,202,223 1.0173,787,100

2022 2,601,562 1.5% 1.3%2,290,784 1.1171,475,087

2021 2,851,127 1.7% 1.4%2,386,171 1.2168,873,525

2020 2,952,234 1.8% 1.1%1,838,365 1.6166,022,398

2019 5,555,920 3.5% 1.5%2,494,626 2.2163,070,164

YTD 4,838,693 3.1% 1.5%2,360,245 2.1162,352,937

2018 2,885,600 1.9% 1.7%2,653,135 1.1157,514,244

2017 5,065,311 3.4% 3.5%5,440,827 0.9154,628,644

2016 3,967,156 2.7% 1.4%2,093,908 1.9149,563,333

2015 1,373,901 1.0% 0.7%949,766 1.4145,596,177

2014 2,282,603 1.6% 2.8%4,084,681 0.6144,222,276

2013 740,459 0.5% 1.9%2,759,002 0.3141,939,673

2012 477,278 0.3% 1.8%2,606,018 0.2141,199,214

2011 (81,993) -0.1% -0.5%(692,811) -140,721,936

2010 174,532 0.1% 1.0%1,375,810 0.1140,803,929

2009 285,179 0.2% -0.5%(766,917) -140,629,397

2008 2,520,287 1.8% 0.7%1,033,737 2.4140,344,218

2007 2,545,471 1.9% 2.6%3,523,988 0.7137,823,931

FLEX SUPPLY & DEMAND



2023 143,268 0.4% -0.1%(28,791) -35,001,649

2022 161,177 0.5% 0%(12,059) -34,858,381

2021 176,444 0.5% 0%1,931 91.434,697,204

2020 348,183 1.0% 0.5%171,733 2.034,520,760

2019 513,772 1.5% 0.9%311,386 1.634,172,577

YTD 212,584 0.6% 0.9%315,348 0.733,871,389

2018 251,067 0.8% 1.2%387,420 0.633,658,805

2017 313,042 0.9% 0.9%301,078 1.033,407,738

2016 187,177 0.6% 0.4%120,975 1.533,094,696

2015 434,700 1.3% 2.4%802,283 0.532,907,519

2014 586,051 1.8% 4.0%1,302,294 0.532,472,819

2013 182,691 0.6% 2.7%870,221 0.231,886,768

2012 149,934 0.5% 1.9%588,135 0.331,704,077

2011 (18,168) -0.1% 1.4%455,497 -31,554,143

2010 130,990 0.4% 0.4%133,510 1.031,572,311

2009 294,581 0.9% -0.3%(86,904) -31,441,321

2008 716,999 2.4% 1.2%360,392 2.031,146,740

2007 405,300 1.3% 2.4%720,615 0.630,429,741


Page 24

Rent & VacancyDenver Industrial

OVERALL RENT & VACANCY

Market Rent

Per SF Index % Growth Vs Hist PeakYear

Vacancy

SF Percent Ppts Chg

2023 176 0.5% 10.7%$10.61 16,533,654 6.4% 0.1%

2022 175 0.9% 10.1%$10.56 16,026,170 6.3% 0.2%

2021 173 1.8% 9.1%$10.47 15,370,269 6.1% 0.3%

2020 170 3.1% 7.2%$10.29 14,540,234 5.8% 0.7%

2019 165 4.0% 4.0%$9.98 12,593,075 5.1% 1.0%

YTD 163 2.8% 2.8%$9.86 12,392,593 5.1% 1.0%

2018 159 7.1% 0%$9.59 9,813,811 4.1% 0%

2017 148 7.6% -6.6%$8.96 9,688,571 4.1% -0.1%

2016 138 7.7% -13.2%$8.33 9,705,764 4.2% 0.7%

2015 128 9.1% -19.4%$7.73 7,864,709 3.5% -0.1%

2014 117 9.2% -26.1%$7.09 8,064,901 3.6% -1.3%

2013 107 6.2% -32.4%$6.49 10,810,686 4.9% -1.9%

2012 101 3.4% -36.3%$6.11 15,224,803 6.8% -1.3%

2011 98 1.5% -38.4%$5.91 18,055,188 8.1% 0.3%

2010 96 -0.9% -39.3%$5.82 17,317,216 7.7% -0.6%

2009 97 -2.8% -38.8%$5.87 18,679,823 8.4% 0.5%

2008 100 0.5% -37.0%$6.04 17,627,759 7.9% 0.9%

2007 99 3.1% -37.4%$6.01 15,334,227 7.0% -1.1%

SPECIALIZED INDUSTRIAL RENT & VACANCY

Market Rent


Vacancy

SF Percent Ppts Chg

2023 185 0.6% 7.3%$11.07 2,805,762 5.7% 0.4%

2022 184 0.9% 6.7%$11.01 2,576,585 5.2% 0.3%

2021 182 1.6% 5.7%$10.90 2,408,514 4.9% 0.4%

2020 179 2.5% 4.0%$10.73 2,225,358 4.5% 1.3%

2019 175 1.5% 1.5%$10.47 1,573,481 3.2% 0.4%

YTD 173 0.6% 0.6%$10.38 1,579,119 3.3% 0.4%

2018 172 8.2% 0%$10.31 1,376,021 2.8% 0.1%

2017 159 8.7% -7.6%$9.53 1,346,893 2.8% 0.7%

2016 147 7.8% -14.9%$8.77 1,000,534 2.1% -0.2%

2015 136 10.1% -21.1%$8.14 1,099,257 2.3% -0.5%

2014 124 9.0% -28.3%$7.39 1,356,001 2.8% -0.5%

2013 113 6.1% -34.2%$6.78 1,583,814 3.2% -3.3%

2012 107 4.4% -38.0%$6.39 3,355,033 6.5% -0.4%

2011 102 2.6% -40.7%$6.12 3,551,977 6.9% 1.2%

2010 100 0.6% -42.1%$5.97 2,951,158 5.8% -0.3%

2009 99 -0.9% -42.5%$5.93 3,109,967 6.1% -0.7%

2008 100 -0.1% -42.0%$5.98 3,491,484 6.8% 0.9%

2007 100 1.5% -42.0%$5.98 3,041,109 6.0% -1.6%


Page 25

Rent & VacancyDenver Industrial

LOGISTICS RENT & VACANCY

Market Rent


Vacancy

SF Percent Ppts Chg

2023 180 0.4% 11.8%$9.69 11,189,278 6.4% 0%

2022 179 0.9% 11.3%$9.65 11,082,012 6.5% 0.1%

2021 178 1.8% 10.3%$9.57 10,768,144 6.4% 0.2%

2020 174 3.3% 8.3%$9.40 10,297,419 6.2% 0.6%

2019 169 4.9% 4.9%$9.10 9,179,572 5.6% 1.3%

YTD 167 3.5% 3.5%$8.98 9,283,557 5.7% 1.4%

2018 161 7.1% 0%$8.68 6,805,109 4.3% 0.1%

2017 150 7.6% -6.7%$8.10 6,572,644 4.3% -0.4%

2016 140 7.8% -13.2%$7.53 6,948,160 4.6% 1.2%

2015 130 9.7% -19.5%$6.98 5,074,584 3.5% 0.3%

2014 118 10.2% -26.6%$6.36 4,650,449 3.2% -1.3%

2013 107 6.8% -33.4%$5.77 6,452,178 4.5% -1.4%

2012 100 3.5% -37.7%$5.40 8,407,546 6.0% -1.6%

2011 97 1.8% -39.8%$5.22 10,602,786 7.5% 0.4%

2010 95 -0.7% -40.9%$5.13 9,991,968 7.1% -0.9%

2009 96 -4.1% -40.5%$5.16 11,193,246 8.0% 0.7%

2008 100 0.5% -37.9%$5.39 10,141,150 7.2% 0.9%

2007 100 3.2% -38.2%$5.36 8,654,600 6.3% -0.8%

FLEX RENT & VACANCY

Market Rent


Vacancy

SF Percent Ppts Chg

2023 155 0.5% 10.9%$14.38 2,538,614 7.3% 0.5%

2022 154 0.9% 10.4%$14.31 2,367,573 6.8% 0.5%

2021 153 1.8% 9.4%$14.18 2,193,611 6.3% 0.5%

2020 150 3.1% 7.5%$13.93 2,017,457 5.8% 0.5%

2019 146 4.3% 4.3%$13.51 1,840,022 5.4% 0.5%

YTD 144 3.0% 3.0%$13.36 1,529,917 4.5% -0.3%

2018 140 5.9% 0%$12.96 1,632,681 4.9% -0.4%

2017 132 6.3% -5.5%$12.24 1,769,034 5.3% 0%

2016 124 7.1% -11.1%$11.52 1,757,070 5.3% 0.2%

2015 116 6.4% -17.1%$10.75 1,690,868 5.1% -1.2%

2014 109 6.4% -22.0%$10.10 2,058,451 6.3% -2.4%

2013 102 4.5% -26.7%$9.50 2,774,694 8.7% -2.2%

2012 98 2.3% -29.9%$9.09 3,462,224 10.9% -1.4%

2011 96 -0.4% -31.5%$8.88 3,900,425 12.4% -1.5%

2010 96 -2.7% -31.2%$8.92 4,374,090 13.9% -0.1%

2009 99 -1.1% -29.3%$9.17 4,376,610 13.9% 1.1%

2008 100 1.4% -28.5%$9.27 3,995,125 12.8% 0.9%

2007 99 4.1% -29.5%$9.14 3,638,518 12.0% -1.2%


Page 26

Sale TrendsDenver Industrial

OVERALL SALES

Completed Transactions (1)

Turnover Avg Price/SFDeals VolumeYear

Market Pricing Trends (2)

Avg Price Price IndexAvg Cap Rate Price/SF Cap Rate

2023 -- - -- 264- $156.03 6.5%

2022 -- - -- 258- $152.72 6.5%

2021 -- - -- 252- $149.09 6.4%

2020 -- - -- 242- $143.29 6.3%

2019 -- - -- 227- $134.19 6.3%

YTD $933.4 M331 3.5% $120.73$4,102,803 2227.1% $131.46 6.3%

2018 $1,545 M580 8.2% $102.75$4,445,539 2156.8% $127.27 6.3%

2017 $1,176 M595 5.7% $109.62$3,110,277 1947.0% $114.76 6.4%

2016 $1,225 M512 5.8% $101.20$3,355,311 1747.5% $102.85 6.7%

2015 $912.8 M513 6.1% $78.17$2,341,483 1567.3% $92.26 6.9%

2014 $1,026 M674 7.8% $67.54$2,193,363 1377.5% $80.90 7.4%

2013 $615.5 M468 5.4% $58.06$1,821,381 1198.9% $70.38 7.8%

2012 $428.9 M404 4.3% $50.43$1,617,049 1098.3% $64.59 8.2%

2011 $283.9 M288 2.6% $55.07$1,482,907 1028.0% $60.27 8.5%

2010 $343.8 M328 3.1% $55.51$1,385,973 968.9% $56.77 8.9%

2009 $216.9 M237 1.9% $56.88$1,473,619 919.8% $53.75 9.3%

2008 $594.5 M429 3.9% $69.26$2,208,056 1007.6% $59.15 8.8%

(1) Completed transaction data is based on actual arms-length sales transactions and levels are dependent on the mix of what happened to sell in the period.

(2) Market price trends data is based on the estimated price movement of all properties in the market, informed by actual transactions that have occurred.

SPECIALIZED INDUSTRIAL SALES





2023 -- - -- 269- $140.93 6.4%

2022 -- - -- 263- $137.87 6.4%

2021 -- - -- 257- $134.64 6.3%

2020 -- - -- 247- $129.64 6.2%

2019 -- - -- 233- $122.23 6.3%

YTD $184.9 M49 3.6% $118.23$4,621,838 2306.7% $120.29 6.3%

2018 $179.8 M83 5.1% $104.20$3,268,827 2218.0% $115.89 6.3%

2017 $137.3 M72 3.3% $109.87$2,474,113 1977.3% $103.07 6.4%

2016 $162.4 M73 4.4% $81.78$2,794,447 1749.3% $91.10 6.7%

2015 $148.4 M78 4.8% $72.87$2,244,281 1567.5% $81.88 7.0%

2014 $234.4 M108 7.3% $68.97$2,625,217 1388.0% $72.27 7.4%

2013 $96.9 M84 6.2% $39.17$1,374,521 1198.7% $62.23 7.9%

2012 $86.4 M49 5.2% $35.18$2,536,024 1097.4% $57.18 8.2%

2011 $40.9 M34 1.8% $46.09$1,239,671 1028.7% $53.21 8.6%

2010 $44.1 M58 2.5% $43.73$979,233 9610.4% $50.38 8.9%

2009 $48.4 M39 2.3% $44.18$1,422,541 9111.7% $47.62 9.4%

2008 $97.2 M52 3.3% $56.93$2,150,880 1008.5% $52.40 8.9%




Page 27

Sale TrendsDenver Industrial

LOGISTICS SALES





2023 -- - -- 267- $150.54 6.5%

2022 -- - -- 262- $147.37 6.5%

2021 -- - -- 255- $143.87 6.4%

2020 -- - -- 245- $138.23 6.3%

2019 -- - -- 229- $129.25 6.4%

YTD $593.9 M215 3.6% $114.52$3,876,992 2257.2% $126.48 6.4%

2018 $1,133 M376 9.6% $97.08$5,010,050 2186.3% $122.88 6.3%

2017 $785.3 M355 5.4% $108.42$3,266,848 1966.8% $110.64 6.4%

2016 $784.3 M323 6.1% $92.97$3,350,216 1766.7% $99.23 6.7%

2015 $567.5 M321 6.6% $72.60$2,405,071 1587.2% $88.94 6.9%

2014 $637.7 M413 8.0% $66.13$2,184,232 1387.3% $77.58 7.4%

2013 $392.2 M276 5.1% $60.59$1,964,783 1208.9% $67.33 7.9%

2012 $261.5 M272 3.8% $54.31$1,461,374 1097.9% $61.57 8.2%

2011 $201.9 M175 2.9% $56.51$1,686,959 1028.0% $57.41 8.6%

2010 $196.8 M192 2.8% $54.19$1,347,614 968.5% $54.01 8.9%

2009 $136.2 M158 2.0% $56.80$1,521,209 918.4% $51.07 9.4%

2008 $361.1 M243 4.0% $65.13$2,026,456 1007.4% $56.33 8.9%



FLEX SALES





2023 -- - -- 248- $203.96 6.5%

2022 -- - -- 242- $199.60 6.4%

2021 -- - -- 237- $194.79 6.3%

2020 -- - -- 227- $187.04 6.3%

2019 -- - -- 213- $174.97 6.3%

YTD $154.6 M67 3.1% $157.58$4,540,284 2087.2% $171.36 6.3%

2018 $232.4 M121 6.1% $141.54$3,483,595 2007.2% $164.59 6.3%

2017 $253.7 M168 10.4% $113.34$3,074,961 1847.2% $151.29 6.4%

2016 $278.3 M116 6.5% $165.35$3,836,621 1668.0% $137.04 6.6%

2015 $196.9 M114 5.8% $107.98$2,241,473 1497.6% $123.05 6.9%

2014 $154.0 M153 7.5% $71.58$1,756,604 1337.4% $109.19 7.3%

2013 $126.4 M108 5.7% $76.37$1,861,741 1179.1% $96.68 7.7%

2012 $80.9 M83 4.9% $65.65$1,541,728 1099.5% $89.69 7.9%

2011 $41.1 M79 2.7% $59.11$1,002,688 1028.0% $84.09 8.3%

2010 $102.9 M78 5.1% $66.23$1,831,198 969.1% $79.11 8.6%

2009 $32.4 M40 1.1% $100.78$1,349,610 929.5% $75.36 9.0%

2008 $136.2 M134 4.6% $102.25$3,060,907 1007.6% $82.33 8.6%




Page 28

denver market · 4650 steele st upper north central 110,562 q3 19 city and county of denver - nai...

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