Industrial Overview
The vacancy rate stayed at 4.4% and there was a positive net absorption of 456,000 square feet over the last 12 months. The average asking rental rates increased to $11.58 PSF. For the first quarter, there are 184,750 square feet still under construction.
Demand in the Colorado Springs industrial market has been steady over the past few years, driven by aerospace, defense, manufacturing, and cybersecurity. The vacancy rate sits at 4.4%, below the national average of 7.0%. The market has limited supply-pressure with space under construction amounting to 180,000 SF, representing just 0.4% of current inventory.
Office Overview
The vacancy rate stayed at 10.3% and there was a positive net absorption of 170,000 square feet over the past 12 months. The average asking rental rates decreased to $22.24 PSF from $22.63 PSF, from Q4 of 2024. For the first quarter, there are 0 square feet under construction.
The Colorado Springs office market is facing demand challenges. However, as of the first quarter, trailing 12-month absorption bounced back into positive territory, amounting to 170,000 SF. Vacancies have decreased in the past year to 10.3%. Still, the vacancy rate remains near the highest to be recorded dating back to 2014.
Retail Overview
The vacancy rate increased to 4.9% from Q4 and there was a negative net absorption of 184,000 square feet over the past 12 months. The average asking rental rates increased slightly to $21.18 PSF from $20.89 PSF, from Q4. For the first quarter, there are 116,292 square feet under construction.
A resilient consumer base, limited construction, and steady leasing activity continues to benefit the Colorado Springs retail market. Retail availability remains low as of the first quarter at 6.0%, below the 10-year average of
6.5%. Low availability is beginning to impact leasing activity as tenants face challenges securing the right type
of space.
THRIVE News
THRIVE assisted their clients in multiple closings this quarter. A couple of notable sales include:
· SOLD – Skyline Apartments, a 26-unit apartment and commercial mixed-use building off Platte Ave.
· SOLD – Flex Condos at 5070-5072 List Dr. in Colorado Springs. Both Buyer and Seller were represented by THRIVE.
· SOLD – single tenant, Tide Cleaners, absolute net lease, with a 6.5% cap rate in Arvada, CO.
Additionally, THRIVE brokers aided their clients in leasing spaces at numerous locations across Colorado Springs including:
· Crow Holdings welcomes new tenant Hello Sugar at 7857 N. Academy
· Luxe Lane at Highlands at Briargate
· Chase Bank at Woodland Park Plaza
Venetian Village Updates: THRIVE has welcomed many new tenants at Venetian Village, the newest of which being Crafted & Thrifted in Q1. Only three inline spaces are remaining.
Highlands at Briargate Updates:
Groundbreak is scheduled to begin in May by Davis Development on 220 luxury apartments and 20+ luxury townhomes. Only three inline spaces remain.
