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Tech Sector Now Leads U.S. Office Leasing
The tech industry increased its share of U.S. office leasing activity to 18% in the first three quarters of this year, boosted in part by companies deploying artificial intelligence, CBRE said in its annual Tech-30 report. Tech now claims the largest share of U.S. office leasing, beating out the finance & insurance industry (16.5%) and professional & business services (15.7%).
Companies engaged in AI development and deployment, while still a small portion of leasing activity, are a growing contributor to tech’s overall share. AI startups have leased 10.8 million square feet of office space since 2019 across the five top markets for venture capital funding of AI companies: San Francisco, Silicon Valley, Boston, Los Angeles/Orange County and Manhattan.
“AI will generate more jobs than it eliminates,” said Whitley Collins, CBRE global president of occupier advisory & transaction services. “The growth of that subsector, as well as any continued tech job growth overall, should provide a spark for office leasing activity. It is also encouraging that, even though many tech companies have reduced their office footprints due to hybrid work, the industry’s cumulative square footage leased so far this year leads all other industries.”
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