Free rent concessions are one of the most powerful tools commercial tenants can negotiate — ranging from 1 month per year of lease term in tight markets to 18 or more months for Class A office space in high-vacancy conditions. This page covers current benchmarks by property type and market, the five main free rent structures, negotiation tactics for maximizing leverage, and a formula for calculating effective rent so tenants can compare proposals accurately. In Denver’s office market, where vacancy has surpassed 26%, SVN Denver advisors are actively securing 12–18 months of free rent on 5–7 year Class A deals.

The optimal commercial real estate hold period ranges from 3 to 10+ years depending on investment strategy, market cycle positioning, and tax objectives. SVN Denver advisors counsel investors to plan for 5–7 year holds while remaining flexible — exiting early when value is created ahead of schedule or extending through market weakness. This guide covers hold periods by strategy type, IRR implications, tax treatment, exit options, and the decision matrix for knowing when to sell.

Commercial real estate returns range from 5–9% IRR for core strategies to 20%+ for opportunistic investments, depending on risk, leverage, and execution. Historically, REITs have delivered nearly 10% net returns over 25 years, outperforming private real estate on a risk-adjusted basis. This guide breaks down commercial real estate returns by strategy, property type, and key metrics to help Colorado investors set realistic expectations in 2026.