Region facing sizzling commercial, residential markets

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Commercial real estate sees large developments in 2017

Current and future commercial developments have many in the Pikes Peak region excited about the future.

The city saw the opening of multiple new businesses, as well as ongoing development and construction starts around Colorado Springs, including the Ent Center for the Arts at UCCS, the U.S. Olympic Museum and Hall of Fame downtown, the Victory Ridge development and Children’s Hospital on the Northside, and commercial developments on south Tejon Street and South Nevada Avenue.

“In the office and industrial arena, we are seeing leasing momentum build significantly in El Paso County and Colorado Springs throughout 2017 and into 2018, and new construction projects are picking up throughout the city,” said Nicola Myers-Murty, CBRE Colorado Springs vice president, in an email. “Downtown Colorado Springs is currently seeing over $620 million invested in new construction projects that are underway now or on the drawing board, to include apartments, restaurants, office space, hotels and public projects.”

Though growth can be good for a city, along with it comes difficulties, Myers-Murty added.

“We are at the point in the real estate cycle where it makes sense to build more speculative construction office and industrial product to meet current demand and attract new employers,” she said.

Colorado Springs third quarter office report

(Source: CBRE Colorado Springs)

Net Rentable Area

2017: 28.5 million square feet

2016: 28.5 million square feet

Direct Vacancy 

2017: 3.1 million square feet

2016: 2.9 million square feet

Vacancy Rate

2017: 11 percent

2016: 10.3 percent

Availability Rate

2017: 12.9 percent

2016: 13 percent

Direct Asking Lease Rate

2017: $11.96/sq. ft.

2016: $11.65/sq. ft.

Colorado Springs third quarter industrial report 

(Source: CBRE Colorado Springs)

Net Rentable Area

2017: 31.2 million square feet

2016: 31.1 million square feet

Direct Vacancy 

2017: 3.2 million square feet

2016: 3.5 million square feet

Vacancy Rate

2017: 10.5 percent

2016: 11.3 percent

Availability Rate

2017: 12.6 percent

2016: 11.9 percent

Direct Asking Lease Rate

2017: $7.56/sq. ft.

2016: $7.19/sq. ft.

Colorado Springs third quarter retail report 

(Source: TransWestern)

Inventory

2017: 40.8 million square feet

2016: 40.6 million square feet

Direct Vacancy 

2017: 2.1 million square feet

2016: 2.1 million square feet

Vacancy Rate

2017: 5.43 percent

2016: 5.30 percent

Direct Asking Lease Rate

2017: $12.65/sq. ft.

2016: $12.16/sq. ft.


Residential real estate in Colorado Springs a hot topic in 2017

It was no surprise to those in the real estate industry locally that Colorado Springs made several national real estate lists in 2017.

A shortage of affordable houses (under $300,000) for sale, houses selling for more than the asking price and the lack of affordable housing being built were among the most popular discussions in the industry in this year, with sellers seeing multiple offers within hours of putting a house up for sale, and sometimes even before a house was listed.

“They’re going for higher [prices] because if you only have 10 houses and 100 people looking to buy a house … it’s a bit of a bidding war,” said Kristen Coderre, operations manager for Pink Realty. “That was a large proportionate reason why selling prices were higher, because inventory was low. … Instead of a slow trickle in winter months, there were times we had 10 offers within an hour [of listing] on a single property.”

Because houses are taken off the market so quickly, low inventory was the biggest challenge for buyers, according to Coderre.

“I don’t think anybody can deny that Colorado’s one of the greatest places to live,” she said.

Third quarter residential real estate market overview

(As of November)

Active Inventory

2017: 1,702 units

2016: 1,932 units

YTD Units Sold 

2017: 15,133

2016: 14,087

Average price of homes

2017: $317,368

2016: $288,295

Average price change from prior year

2017: 10.08 percent

2016: 7.92 percent

Average Days on Market

2017: 33

2016: 39

(Source: REALTOR Services Corporation, Pikes Peak Association of Realtors)

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