AI Office Demand Rises 27% Year-Over-Year

The number of new AI office leasing requirements rose 27% over the past year, from 644 to 820, VTS reported. Twelve of the 17 markets VTS tracks contributed to that growth.

Most of the demand is concentrated in three markets: San Francisco, New York and Silicon Valley. Combined, they account for 64% of the 16.9 million square feet of active AI demand, and they hold 55 of the 83 large (50,000-plus square feet) requirements nationwide.

Within this group, New York has moved into second place, according to VTS. Its 2.79 million square feet of active AI demand edges out Silicon Valley’s 2.78 million square feet, and it now has more large requirements than Silicon Valley, 18 to 16.

Austin ranks fourth for active AI office demand with 1.25 million square feet, followed by Dallas-Fort Worth at 769,000 square feet. Growth is uneven across smaller markets. Some are surging from lower bases, including the San Francisco East Bay (up 130%), Washington, DC (up 94%) and Northern Virginia (up 50%). Others are pulling back, including Houston (down 54%), Atlanta and Seattle Eastside (each down 36%) and Denver (down 16%).

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 16-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 7-10 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

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