Immigration and Weak Hiring Puts Pressure on Vacancy in Denver's Multifamily Market
Economic uncertainty and weak hiring put pressure on Denver's multifamily vacancy in 2025. Unfortunately, that may continue to linger into this year, according to the latest investment forecast market report from Marcus & Millichap.
In 2025, Denver's unemployment rate dropped, but job gains continue to leave more to be desired. In 2026, Marcus & Millichap is only forecasting a 0.5 percent increase in employment, with 8,000 new roles added.
"Labor and immigration headwinds impact renter demand," the brokerage admitted, with vacancy expected to rise by another 10 basis points in 2026 to six percent.
"At 6.0 percent, Denver has the fifth-highest rate among major markets," it added.
Since 2020, foreign migration has led to more than 60 percent of Denver's population growth, as noted in the report. In 2025, larger immigrant center neighborhoods, including Glendale, Commerce City and North Aurora, faced the most vacancy pressure.
However, there is a sprinkle of good news. Vacancy spikes are limited thanks to the limited deliveries expected this year. Marcus & Millichap also projects construction will fall by more than 3,000 units this year to 6,000 units, which makes up less than a third of the number seen during the peak of 2024.
Moreover, the rest of the fundamentals look solid going forward. Marcus & Millichap estimates that rents will rise by 2.1 percent to $1,825 this year, reversing two straight years of declines, thanks to concessions dropping on recently delivered assets.
Also, investment activity was strong in 2025, with Denver outpacing other Sun Belt markets in terms of the number of sales posted, including Atlanta and Phoenix.
"West Denver neighborhoods like Wheat Ridge, Lakewood, and Arvada are likely to remain active, due to vacancy near metro lows around 5 percent and limited construction," Marcus & Millichap predicted.
Source: GlobeSt/ALM