> ## Content Index > Fetch the complete content index at: https://www.brianmccririe.com/llms.txt > Use this file to discover other available public pages before exploring further. # Buy vs. Lease Office Space in Denver: Is This Your Window? - URL: https://www.brianmccririe.com/buy-vs-lease-office-space-denver/ - Published: 2026-09-15T12:01:00.000Z - Updated: 2026-09-15T12:01:04.000Z - Description: Southeast Denver office traded this summer at $86 to $97/SF, below replacement cost. Here's who should buy and who should keep leasing. - Author: Brian McCririe - Tags: Owner-User & Sale-Leaseback, Investment & Capital Markets, Decision ## Should your company buy office space in Denver instead of leasing? Buying works right now for a narrow profile: a company with stable or growing Denver headcount, a ten-year-plus horizon, real balance sheet capacity, and a space need that fills a whole building or a condo-able floor plate. This summer an owner-user bought a southeast Denver office campus for about $97 per square foot and an investor bought a renovated one nearby for about $86, both well below what it would cost to build today. For everyone else, and that is still most companies, leasing into a metro at roughly 27% vacancy with about a month of free rent per year of term is the better trade. Ask the internet this question and you get "lease, it's more flexible." In Denver in 2026, that answer is incomplete. ## Three owner-user deals closed in one month at half the old price The Colorado Real Estate Journal's August 5 to 18, 2026 issue reported two southeast suburban office sales that closed within weeks of each other. One was an owner-user. The other was an investor, and it is in here because it shows what an occupied campus costs to carry. UCHealth bought One and Two Greenwood Plaza, 198,560 square feet, for $19.36 million. That is roughly $97 per square foot. Lycan Capital, an investor, bought Inova Corporate Center I and II in Englewood in June: a two-building campus of 187,087 square feet of renovated Class A, for $16.08 million per SKLD Information Services. Roughly $86 per square foot, 82% leased at closing, with 3.8 years of weighted average lease term remaining. The sellers had paid $19.11 million in 2017 per Arapahoe County records and put more than $5 million into renovations during their hold. Hold the gap between those two prices, because it is where the buy case comes from. The 2026 price is $3.03 million below the 2017 price before you count the renovation spending. Whether the sellers lost money depends on their financing, their taxes, and nine years of rent, none of which is public. What is public is that renovated Class A in this submarket cleared at about $86 a foot, and that is the number an occupier is buying against. Now put those numbers next to the rest of the market. Denver's Q2 2026 office investment volume ran $222 million at an average of $174 per square foot, up from $101 per square foot in Q1 (CBRE). In Cherry Creek, 255 Fillmore traded at a record $941 per square foot. Same metro, same quarter, more than a ten-to-one spread. Denver office stopped being one market. Cherry Creek Class A sits at 1.8% vacancy and $68.32 per square foot (CBRE, Q2 2026), while the CBD sits at 38.6% (CBRE) and the metro runs near 27% on the major brokerages' read. Commodity space in a soft submarket is being repriced to what its cash flow can support. That is why a healthy company with cash can now buy a building for less than it would cost to construct one. ## The buy case works for one profile, and it is narrow Four tests. You need all four, not three. **Your Denver headcount is stable or growing, and you can defend the number.** Not your 2019 headcount and not your optimistic 2029 headcount. If your utilization is still moving because your hybrid policy is still moving, you are not a buyer yet. Buying converts a flexible obligation into a fixed asset at exactly the moment you need flexibility most. **Your horizon is ten years or longer.** Acquisition costs, financing costs, and the eventual sale cost do not amortize over five years. If there is a credible path where you are somewhere else by 2032, lease. **You have balance sheet capacity, and this is the best use of that capital.** The real test is not whether you can write the check. It is what a dollar earns inside your operating business. If capital deployed in hiring, equipment, or product returns well above what a building will produce, buy nothing. Lease, and put the money where it compounds faster. **The building fits what you actually need.** Owner-user pricing lives in whole buildings and large floor plates, because that is the inventory nobody else wants. If you need 12,000 square feet and the discount is on a 40,000 square foot building, you did not buy an office. You bought a leasing assignment. That last one deserves the Inova example. At 82% leased, the buyer inherited roughly 34,000 square feet to fill in a metro running near 27% office vacancy. That is a landlord's job with a landlord's costs: commissions, tenant improvement dollars, free rent, and carry while it sits empty. Some owner-users want that income stream and are equipped to chase it. Most just want a headquarters, and they consistently underestimate what the other 18% costs to fill. So here is the honest counter-list. Keep leasing if your hybrid utilization is unresolved, if your growth curve depends on a funding round or a contract renewal, if there is an acquisition path that could relocate or consolidate you, or if your capital is simply more productive inside the business. That describes most of the Denver market, and it should. The tenant side of this market is paying you to stay flexible right now: roughly a month of free rent per year of term plus elevated TI allowances in the deals I am seeing, against $34.07 per square foot full service asking rents that are down 0.8% year over year (CBRE, Q2 2026). ## Six numbers decide this, and debt service versus rent is only the first **1\. Debt service against net effective rent, not face rent.** This is where most buy-versus-lease models break. The lease side of the comparison has to be [what leasing actually costs you after concessions](https://www.brianmccririe.com/face-rent-net-effective-rent-denver-office/), not the asking rate on the flyer. With a month free per year of term and heavy TI, the real number can sit well under the face rate, which narrows the ownership advantage a lot more than most CFO models assume. **2\. The down payment and what it would have earned.** A 25% to 35% equity check on a $16 million building is capital that leaves the business. Price the opportunity cost explicitly. If nobody in the room can say what that money would have returned in the operating company, the analysis is not finished. **3\. Replacement cost.** At roughly $90 per square foot you are buying below what it costs to build. That is the strongest argument in the buy case, and the only one that does not require you to forecast rents. **4\. Operating expenses and capital expenditures you now own.** Roof, chillers, elevators, parking lot, lobby, life safety. Under a full service gross lease those are the landlord's problem. Own the building and they are a budget line forever, and in a 27% vacancy market the buildings that lease are the ones that keep spending on themselves. **5\. Carry on square footage you do not occupy.** Every foot you are not using is negative cash flow until you lease it, and you are competing against landlords who have been discounting for three years. **6\. The exit.** Your buyer in year ten prices the building off its income and the [cap rate environment at that time](https://www.brianmccririe.com/denver-office-cap-rates-2026/), not off what you paid. The Inova sellers, professional owners, sold for $3.03 million less than they paid in 2017 after spending more than $5 million on the buildings. Underwrite the purchase on occupancy value, the rent you stop paying, the control you gain, the basis you locked in. Treat any appreciation as a bonus you never counted on. ## The tax break is permanent. The price is not. The One Big Beautiful Bill Act, signed in July 2025, permanently restored 100% bonus depreciation for qualified property acquired and placed in service after January 19, 2025\. No phase-down, no sunset. It does not apply to the building. A 39-year shell depreciates on the 39-year schedule, same as always. What bonus depreciation reaches is the short-life property a cost segregation study reclassifies out of the shell into 5, 7, and 15-year categories: fixtures, systems tied to equipment, furniture and equipment, site work, landscaping, and parking improvements. On a recently renovated Class A building, the reclassified share can be meaningful, and the study is what determines it. How much your specific acquisition would produce depends on the building, the improvements, and your own tax position. Confirm all of it with your CPA and your tax advisor before it becomes a line in your model. I am a broker, not a tax advisor, and this is the part of the deal where that distinction costs real money if you get it wrong. Now the timing point, and it is the one I would put in front of a CFO first. The tax treatment is federal and permanent. Every company in every market gets the same rules next year, and the year after. The price is local and temporary. Q2 investment pricing already moved from $101 to $174 per square foot on average (CBRE), office tenants took roughly 119,700 square feet more than they vacated in Q2, the strongest quarterly net absorption since Q1 2022 (Cushman & Wakefield), and metro sublease availability has fallen five straight quarters. This basis is not a permanent condition. It is a repricing, and other buyers are already competing for it. Only one of those two things waits for you. If you are on the other side of this, already owning your building and wondering whether to monetize it, the math runs backward through the same inputs. That is a [sale-leaseback versus refinance decision](https://www.brianmccririe.com/sale-leaseback-vs-refinance-denver/), and it turns on your cost of capital rather than your cost of occupancy. ## Frequently asked questions **Is it cheaper to buy or lease office space in Denver right now?** It depends on your horizon and your headcount, not on a single rent-versus-payment comparison. Southeast suburban office traded this summer at roughly $86 to $97 per square foot, below replacement cost, while tenants are getting free rent and improvement allowances against $34.07 per square foot full service asking rents (CBRE, Q2 2026). Over a ten-year hold with stable occupancy, buying usually wins. Under five years, or with uncertain headcount, leasing usually wins. **How much does it cost to buy an office building in Denver in 2026?** Two southeast suburban office sales closed this summer between roughly $86 and $97 per square foot. The Colorado Real Estate Journal reported in its August 5 to 18, 2026 issue that UCHealth, an owner-user, paid $19.36 million for 198,560 square feet at One and Two Greenwood Plaza in July, and Lycan Capital, an investor, paid $16.08 million for 187,087 renovated Class A square feet at Inova Corporate Center I and II in June. Prime product is a different market entirely, with 255 Fillmore in Cherry Creek trading at a record $941 per square foot. **What size company should consider buying its own office building?** Less about employee count, more about whether your space need matches the inventory that is actually discounted. Owner-user pricing sits in whole buildings and large floor plates, which usually means a requirement of 40,000 square feet or more, or a building you can condo. A company needing 10,000 square feet is generally better off leasing rather than buying a building and becoming a landlord for the rest of it. **Does 100% bonus depreciation apply to buying an office building?** Not to the building shell, which stays on a 39-year schedule. Under the One Big Beautiful Bill Act signed in July 2025, 100% bonus depreciation was permanently restored for qualified property acquired and placed in service after January 19, 2025, and it applies to the 5, 7, and 15-year components a cost segregation study reclassifies out of the shell. Confirm the treatment and the amounts with your own CPA and tax advisor before relying on them. **What is the biggest risk of buying an office building as an owner-user?** Vacant square footage you did not plan to carry. The Inova deal closed at 82% leased, which leaves roughly 34,000 square feet to fill in a metro running near 27% office vacancy, with all the commissions, TI, and free rent that implies. The second risk is the exit, since the sellers in that deal received $3.03 million less than they paid in 2017. Most Denver companies should still lease, and the concession package right now rewards them for it. But if your headcount is stable, your horizon is long, your balance sheet can carry it, and the building genuinely fits, high-$80s per square foot is a basis Denver occupiers have not been offered in years, and you are buying it from a seller taking the loss to make it happen. The mistake is deciding this from the headline instead of the sheet. --- **If you are weighing a Denver lease renewal against buying a building, I will run both sides on the same sheet: net effective rent against debt service, the carry on space you would not occupy, and what the exit looks like in year ten.** [**Schedule a conversation.**](https://www.brianmccririe.com/meet-with-brian-mccririe/?utm%5Fsource=blog&utm%5Fmedium=cta&utm%5Fcontent=buy-vs-lease-office-space-denver) --- **About Brian McCririe** Brian McCririe is Executive Managing Director of SVN | Denver Commercial and National Council Chair for Occupier Services across the SVN network. After 25 years representing tenants and investors across global markets, he now focuses on the Denver Metro area helping companies navigate leases, acquisitions, and the gap between what landlords offer and what occupiers deserve. He leads one of the metro's top tenant rep practices and writes about the deals, decisions, and market shifts that matter to corporate real estate leaders.