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Denver Industrial Construction Pipeline Shrinks as Leasing Momentum Rises

Marcus & Millichap's midyear 2026 outlook identifies slowing supply growth alongside leasing momentum in Denver's industrial sector.

By Colin Percy · May 20, 2026

Denver's industrial market is experiencing a period of supply normalization, with inventory growth projected to increase by only 1.0 percent throughout 2026 as developers reduce new construction starts. Following several years of elevated supply, this pullback is helping to stabilize market fundamentals despite a forecast for modest vacancy increases. Leasing activity improved substantially in the first quarter of 2026, driven largely by commitments in northeast Denver and key logistics corridors.

Transaction activity remains anchored by private investors, particularly for smaller-format warehouse and distribution assets situated near Interstate 70 and Denver International Airport. Long-term demand is expected to be bolstered by significant projects, including a 1.2 million-square-foot production facility planned by Pepsi and a large manufacturing plant for Philip Morris International's Zyn product in Aurora.

Companies mentioned

owner

Pepsi

owner

Philip Morris International

tenant

Marcus & Millichap

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