How the AI leasing boom helped fuel the 2025 US office market is changing empty buildings into busy hubs. Tech firms rushed to sign big leasing agreements this year. This matters because empty offices hurt cities after the pandemic. Now AI infrastructure growth brings jobs and steady rent. The rest of this piece explains key deals, city wins, and what comes next for you.
Key Highlights
- AI firms signed deals for over 10 million square feet in top cities like San Francisco.
- Office vacancy rates dropped fastest since 2019, thanks to tech demand.
- Tech now leads 18% of all US office leases, beating finance sectors.
- Hyperscaler demand from giants like Nvidia and OpenAI sparked the surge.
- Smaller cities outside Silicon Valley see new life from AI expansions.
- Growth could cut vacancies in half by 2030 if trends hold.
How the AI leasing boom helped fuel the 2025 US office market step by step
AI companies needed space fast to hire and build. They skipped remote work and picked office-first models. This filled towers that sat empty for years.
Tech firm expansions started in the Bay Area. Firms like Databricks took whole buildings, like 200 W. Washington Ave. in Sunnyvale. Their team doubled twice in two years.
Deals grew bigger over time. Early leases were 3,000 to 5,000 square feet. Now many hit 15,000 to 20,000 as funding flows in. Leasing agreements surge shows firms plan to stay and grow.
Key cities winning from US office revival
San Francisco led with AI tenants outpacing others. AI data center leases and offices mixed to drop vacancies for four quarters straight. Over 5 million square feet leased in five years.
Silicon Valley hit past 10 million square feet this year. Power-constrained markets like Seattle got boosts too. OpenAI filled Microsoft space in Bellevue.
Even non-tech spots benefit. Walmart and IBM joined with AI pushes beyond California. This spreads commercial real estate recovery nationwide. Check CBRE US Office Figures for more data trends.
Bay Area boom details
Nvidia reached $4 trillion value and grabbed prime spots. They eye $4 trillion in global AI spend by decade end.
Anthropic nears a full 400,000-square-foot tower at 300 Howard St. Harvey AI added floors in Manhattan quick. These moves show hyperscaler demand at work.
Spread to other markets
New York sees trophy towers fill. AI firms gut old back-office needs but lease high-end space. For more on AI’s impact on real estate markets, read our guide.
Why AI tenants differ from past tech waves
Old tech like Google went hybrid. AI infrastructure growth demands teams close for fast work on models and chips. Mark Lammas of Hudson Pacific said AI sticks to offices.
Firms race to beat growth limits. Nigel Hughes from CoStar notes they pick sites for future scale. Mike McCarthy of Transwestern sees lease sizes jump as startups mature.
This fuels occupancy at best rates since mid-2019. Tech took one-fifth of deals per reports. See JLL Global Real Estate Outlook for wide views.
| City | AI Leases (sq ft, 2025) | Vacancy Drop | Key Tenant Example |
|---|---|---|---|
| San Francisco | 5M+ | 4 quarters | Databricks, OpenAI |
| Silicon Valley | 10M+ | Steady gain | Nvidia expansions |
| Seattle | Growing | Quick fill | OpenAI Bellevue |
| New York | Trophy towers | Rising demand | Harvey AI |
What this means for businesses and workers
If you run a firm, eye AI-nearby offices. Office vacancy rates fall means higher rents, but more jobs nearby. Startups can lease smaller now and scale up.
Workers gain from US office revival. Close teams speed AI projects. Cities get lively streets again.
Landlords shift to power-constrained markets prep. New builds slow, so existing spots lease fast. For hyperscalers investing in AI infrastructure, see trends.
Future outlook on leasing agreements surge
Expect more in 2026. AI spend hits trillions, pulling offices along. Projections say San Francisco vacancies halve by 2030.
Tech firm expansions may hit new cities. Watch AI data center growth trends. Firms like Uber test related tech – see Uber Lyft robotaxi trials.
This commercial real estate recovery helps all. It shows AI lifts markets when others lag. Stay ahead by tracking these shifts.
Business & Worker Wins
Firms near AI hubs face rising rents but gain jobs and vibrancy. Workers benefit from speedy projects and lively streets. Landlords pivot to power-ready retrofits amid slow new builds.
2026 Outlook
AI spend projected at trillions pulls more offices; San Francisco vacancies may halve by 2030. Watch expansions to Austin and robotaxi ties like Uber trials. Track CBRE/JLL reports for updates.
What caused the 2025 US office market recovery?
AI companies drove the rebound by signing large leases for office space, prioritizing in-person collaboration over remote work unlike past tech waves. Tech firms accounted for about 17-20% of all US office leases, fueling occupancy growth at the fastest rate since mid-2019.
Which cities benefited most?
San Francisco led with AI tenants leasing over 5 million square feet in recent years, dropping vacancies for four straight quarters. Silicon Valley saw 10 million+ square feet, while expansions reached Seattle, New York, and beyond.
What are key AI leasing deals?
Databricks leased an entire 338,000 sq ft building in Sunnyvale and expanded in San Francisco. Nvidia took 45,000 sq ft in San Francisco’s Mission Rock; Anthropic nears 400,000 sq ft at 300 Howard St.; OpenAI expanded to Bellevue and over 1M sq ft in SF.
