Fewer people will likely work in downtown Denver now than before the pandemic, city officials and real estate experts say, and that’s even with companies shifting some employees back into offices.
But officials at the Downtown Denver Partnership say they expect to balance the continuation of remote work with a hoped-for influx of new companies moving downtown.
Denver was already trending in the direction of less office space in favor of more places for people to live and for tourists to visit, according to Emily Brett, the partnership’s director of economic development. The pandemic just sped up that process.
“We had maybe 10 years of change in one year,” she said.
On a given pre-pandemic weekday, Brett said downtown Denver would have as many as 110,000 employees. Recently, that’s shrunk to as few as 25,000 people.
To help bring some employees back downtown, the partnership and city put forth the Denver’s Ready pledge, which asked businesses to commit to transitioning back into their office by earlier this month. Brett said at least 170 companies had signed on.
“We know and expect that most companies are going to move to a hybrid model,” she said. “All we’re trying to do (with the pledge) is start the conversation of planning, try to put some dates around it.”
But there’s no going back fully to the way things were, she acknowledged. Most businesses likely won’t have the bulk of employees back until the third quarter, according to one estimate from the real estate services firm CBRE.
Even then, according to CBRE’s Pete Schippits, companies likely will have employees on-site for an average of one day less each week.
Wells Fargo, which has offices downtown, wants to return to a “more normal operating mode” come probably September, but its officials are still working to define what that looks like.
“We believe most of us benefit by being physically together, but we also appreciate that flexibility is important and we are not taking a one-size-fits-all approach,” spokeswoman Yahaira Garcia-Perea said.
Downtown has a higher vacancy rate now, too. Of the 40 million available square feet of office space downtown, nearly 17% is vacant now, compared to the 12% rate before the pandemic began, Brett said. Subleases have also doubled.
But none of those changes mean the downtown economy is cratering, said Deborah Cameron, chief business development officer for the city’s office of Economic Development & Opportunity.
“It’s not good or bad, it’s just going to be different,” Cameron said. “It’s going to be a period of transition for both the office spaces and the retailers and restaurants that call downtown home.”
One company well positioned to capitalize on the changing landscape is WeWork, which offers shared workspaces for individuals, small businesses and larger companies.
Aaron Romigh, vice president for the company’s western territory, said the company’s Denver locations saw five times the amount of on-demand bookings in April as compared to January. And the company is looking for more places to open all across Denver, he added.
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