Can downtown Denver rebound? Vitality not vacancy is the test, urbanist says

By Mark Samuelson | The Denver Gazette

The Downtown Denver Partnership — the nonprofit consortium that stood at the very center of the corridor’s remarkable renaissance during the 1980s and 1990s — issued a report Thursday tackling the multiple issues that continue to plague the city’s central business district.

Don’t give up on downtown, University of Toronto professor Richard Florida, prominent urban theorist and the 50-page report’s author, told The Denver Gazette following its release Thursday.

“Often the place that is most distressed comes back fast and furious,” said Florida, who in 2002 authored “The Rise of the Creative Class,” a work that anticipated many of the tech-driven changes to the workforce that would affect urban economies.

“These are challenging projects,” Florida said following his dive into downtown’s current outlook, which he said involved walking the streets, mixing with the crowds, as well as comparing Denver’s downtown to other urban areas that have faced similar challenges. 

“This is an everywhere problem,” Florida said, noting similar issues he has studied in other downtowns, including Detroit and Miami.

An ‘everywhere problem’

Local leaders have pushing back against perceptions of a declining downtown, including what The Wall Street Journal had recently called “America’s Emptiest Downtown.” A campaign called “Denver. Best Return on Life” launched a marketing campaign in select cities nationwide.

The downtown corridor has been plagued with perceptions of crime and homelessness, in additions to vacancy woes. Beyond downtown woes, businesses have complained about Colorado’s — and Denver’s — regulatory environment, citing, among other things, energy requirements for large-scale buildings.

Notably, both Denver and the Colorado government have required sweeping reductions in energy use and greenhouse gas emissions by larger commercial buildings. The Energize Denver ordinance, adopted in 2021 and enforced by Denver’s Office of Climate Action, Sustainability and Resiliency (CASR), requires buildings sized 25,000 square feet or larger to slash emissions 30% by 2032 and by 80% by 2040.

Meanwhile, a bill passed by the legislature in 2021, issued as Regulation 28 by Colorado’s Air Quality Control Commission in 2023, mandated 7% reductions in buildings of 50,000 square feet and larger by 2026, and 20% by 2030.

Businesses have argued that these changes would significantly add to costs, which would be passed down to consumers.

The challenges plaguing the economic corridor looked all the more daunting this week, as commercial real estate broker CBRE came out with its latest report on office vacancies — similar to other recent reports from a variety of sources, showing a slight improvement in office performance metrowide but with downtown as an outlier.

“Overall net absorption totaled negative 161,000 sq. ft., but the suburbs and Downtown Denver moved in opposite directions,” CBRE reported about the last quarter. 

“Downtown’s total vacancy rose 150 (basis points) to 40.1%, while suburban vacancy fell 50 (points) to 24.6%, the largest quarterly decline in more than five years.”

Negative performance in the downtown submarket, CBRE added, was exaggerated over the quarter when financial services provider TIAA packed and left some 293,000 square feet on Broadway, where for two decades it had been the headliner of a 36-story building.

One month ago, Optiv Security reported it, too, is leaving the 40-story Class AA tower 1144 15th Street. As the building’s headliner, it had at once occupied 75,000 square feet in what was one of very few new offices to arrive in downtown in recent decades.

According to CBRE, total vacancies in the downtown submarket now stand at 40.1%, worsening more than a point from CBRE’s Q2 report at 38.6%.

Vacancy wrong measure

Florida insisted that vacancy rates aren’t the way to gauge Denver’s potential to thrive in coming years.

“Vacancy is the wrong measure. A better one is vitality,” Florida told The Denver Gazette. In his sojourns around Denver, he reported seeing strong evidence of that, he said.

“I couldn’t get a room,” Florida said of his current trip to the Mile High, as he perceived what appeared to be competition for hotel accommodations from out-of-town Broncos fans.

“Downtown Denver is in the midst of a remarkable reinvention,” Florida wrote in the partnership’s report, “The Next Era of Downtown Denver: Reinventing Downtown for the Way We Live Now,” issued Thursday morning.

He noted that Denver’s seven professional sports franchises are investing $10 billion in a series of mixed-use districts that include housing, restaurants, retail, entertainment, offices and public spaces. That, he said, “stands in sharp contrast” to other cities, where major professional sports franchises are moving away from downtown to the suburbs. 

He referenced a study by urban development expert Paul Levy, pointing to the outsized contribution that visitors make to a downtown’s vitality.

“Downtown is still largely thought of as a place where people mostly work and occasionally live — but that is no longer the case,” the report said, adding, “Visitors, not office workers, are the engine of downtown.”

Florida noted that, in a Levy study of 26 U.S. downtowns, visitors accounted for more than 60% of downtown activity, as opposed to 27% by workers and 11% by residents.

He said that visitors account for an even higher share of activity in downtown Denver — a total of 67% in 2025.

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