Following nine years of annual growth, nonfarm payroll employment in the Colorado Springs MSA declined by 2.6% on an average year-to-date basis through December 2020 (losing 7,800 jobs). Although below the peak of 12.6% in April 2020, the unemployment rate in December remained elevated at 8.7%.
Direct vacancy increased to 9.4% in Q4 2020, up 600 basis points from Q2 2020.
Negative net absorption of 73,000 sq. ft. was recorded in H2 2020, which ended the year at negative 26,000 sq. ft. This is the first time in nine years that negative net absorption was recorded.
Construction remained active with over 371,000 sq. ft. of office space under development at the end of Q4 2020. Three buildings delivered, bringing 141,000 sq. ft. of new office space to the market.
The overall average asking lease rate continued to grow, increasing $0.93 quarter-over-quarter and $1.36 on the year to $16.46 per sq. ft. triple net in Q4 2020.
Investment sales volume reached $99.9 million in the second half of 2020, ending the year with an annual volume of $189.8 million. This represented a 16.2% decrease from 2019.