Industrial Overview
The vacancy rate increased to 4.6% and there was a positive net absorption of 637,000 square feet over the last 12 months. The average asking rental rates decreased to $11.3 PSF. For the third quarter, there are 606,918 square feet still under construction.
Office Overview
The vacancy rate increased to 10.3% and there was a positive net absorption of 253,000 square feet over the past 12 months. The average asking rental rates decreased to $22.61 PSF from $23.03 PSF, from Q2. For the third quarter, there are 0 square feet under construction.
Retail Overview
The vacancy rate increased to 4.7% from Q2 and there was a negative net absorption of 156,000 square feet over the past 12 months. The average asking rental rates increased slightly to $20.55 PSF from $20.52 PSF, from Q2. For the third quarter, there are 262,963 square feet under construction.
THRIVE News
The Colorado Springs retail market remains in a position of strength. With 24,000 SF delivered in the past year and another 260,000 SF under construction, the supply pipeline is beginning to put upward pressure on vacancies. Still, the vacancy rate remains near historic lows as of the third quarter.
While demand for industrial properties has held steady, rent growth has decelerated in the past year to just 1.2%. Rents have held up best in Teller County and Southeast Colorado Springs. The pace of rent growth remains below the national annual average of 2.9%. Forecasts project annual rent growth to increase by 1.1%
in 2024 before rebounding in 2025.
The Colorado Springs office market is facing demand challenges. However, as of the third quarter, trailing 12- month absorption bounced back into positive territory, amounting to 250,000 SF. Vacancies have decreased by half a percentage point in the past year to 10.3%. Still, the vacancy rate remains near the highest to be recorded dating back to 2014.
THRIVE assisted their clients in multiple closings this quarter. Land sales at 845 Powers Blvd., 0 Enoch Rd., and 41 lots at the mobile home park at 520 Prospect Rd. in La Junta, CO. THRIVE also helped their clients find a buyer for a quick close at 2275 Spectra Dr. Additionally, THRIVE brokers aided their clients with leases at numerous locations across Colorado Springs and Fountain. This includes multiple new tenants at the Venetian Village off Hancock Ave., Mountain Top Barbers at Markets at Mesa Ridge in Fountain. In addition, Q3 brought many new tenants to fill office spaces of the clients we represent, including office space at 1817 Austin Bluffs, the historic Alamo Building on Tejon St., 7560 Rangewood Dr., 1750 Telstar, and 9524 Federal Dr.
Highlands at Briargate Updates: Construction is still slated to begin before the end of the year by Davis Development on 220 luxury apartments and 20+ luxury townhomes.
