The Booming Sector of Real Estate in Denver
The Denver metropolitan area is home to around 2.7 million people. The Denver-Aurora, Colorado statistical area is home to about three and a half million people. Of greater importance to potential investors, the area is still growing. With Denver’s population growth and e-commerce continuing to expand, industrial development is expected to continue, and rents will continue to be pushed up.
Seeing Denver’s ongoing real estate boom, industry pros are beginning to wonder if the laws of gravity still apply. The Industry has diversified. As Denver becomes a mecca for live-work-play and continues to attract a growing millennial population, companies are relocating to the region to capture the strong employment and concentration of skilled labor. Average lease rates for all types of industrial spaces hit $7.62 per square foot in the first quarter, up 2.8 percent since the end of 2016. Rates jumped even higher for warehouse space, hitting a record $6.54 per square foot, an increase of 5.3 percent quarter over quarter, according to CBRE.
Industrial property brokerage
If you’re looking for Denver commercial properties, then there are a number of brokers who deal with a number of industrial properties. They come with a strong team with years of expertise, thus delivering quality commercial real estate in prime locations to a wide range of clients, throughout Denver. Most industrial listings feature flexible zoning and are move-in ready – ideal for investors and business owners.
When deciding whether to buy commercial real estate, it’s important to understand the potential risks, least you could end up with the feeling that you would have been better off renting. Let’s list down some of the potential risks a business faces when buying:
- Selecting the right broker: Before deciding upon the broker from whom you will take the site. You should check for authenticity and the previous clients that they had. They should have a group with greater experience who can understand your requirements perfectly.
- Location may backfire: What looks good today might not be tomorrow. The market may go bust. Hence, it’s important to check out the location twice before you decide upon taking it.
- Loss of liquidity: Buying real estate in business can lead to the tying up of liquidity. It may not always be easy to resell real estate. At the same time, businesses that own real estate at least have something to sell if they need a cash influx to revive a lagging business.
- Tenuous cash flow: Sometimes, tenants stop paying their rent. And at times, buildings are in need of repairs and unexpected extra expenses. Your cash flow can become compromised, especially if you’re forced to simultaneously pay repairs and attorney fees to handle a tenant situation.
Undertake extensive due diligence before signing any contract. You also need to be hands-on with your commercial property by overseeing every level of operation and making frequent on-site visits; otherwise, you may learn about problems after it’s too late to do anything to fix them.
Obtaining Denver commercial properties for real estate in Denver is a tall order based on the persistent competition for several years. Since 2017, the commercial real estate has exhibited remarkable yields that have attracted and retained investors, and this means that the market could soon be a battleground in its own right.