1031 Exchange in Highlands, Denver, Colorado

The Tennyson Street arts corridor and the 32nd Avenue retail strip have become two of the most sought-after small-bay retail stretches in Denver, drawing independent restaurants, galleries, and boutique fitness tenants that lease space by the storefront rather than the big-box footprint. Turnover on these blocks is low, so exchangers who want Highlands exposure often have to move quickly when a corner storefront comes available.

Both corridors have also benefited from a Second Friday Art Walk tradition on Tennyson that consistently drives evening foot traffic, which retail tenants along the strip cite directly when negotiating lease renewals — a soft but real demand driver worth factoring into rent-growth assumptions.

Lower Highland, known locally as LoHi, has densified faster than the rest of the neighborhood, with mid-rise mixed-use replacing single-story buildings within blocks of the pedestrian bridge into downtown. That density has pulled retail rents up along Boulder and Central Streets, and 1031 buyers targeting LoHi specifically are usually underwriting for continued vertical redevelopment rather than a static hold.

The rooftop bar and restaurant scene that developed alongside LoHi's density has also made ground-floor hospitality space some of the highest-demand retail in the neighborhood, though that same demand has pushed pricing to a point where cap rates now run tighter than most other Highlands sub-pockets.

Away from the main corridors, much of Highlands is still zoned around its original bungalow housing stock, and infill developers have been converting corner lots into small mixed-use buildings that pair ground-floor retail with a handful of residential units above. These infill projects are small enough to fit a mid-size exchange budget without competing against institutional buyers.

Because these infill parcels are individually small, assembling more than one adjacent lot is sometimes the only way to reach a scale that justifies ground-up construction, and we help exchangers evaluate whether a target property has realistic assemblage potential before they commit to identifying it.

Highlands consistently ranks among Denver's most walkable neighborhoods, and that walkability is the single biggest driver of retail rent premiums on Tennyson and 32nd — tenants pay up for foot traffic that doesn't depend on parking. We weigh walk-score data heavily when helping Highlands exchangers compare one storefront against another.

That same walkability has made Highlands multifamily product attractive to renters who want an urban lifestyle without a downtown price tag, and apartment vacancy in the neighborhood has generally tracked below the citywide average as a result.