- AI leasing hit 486K SF in Manhattan through Q3 2025 — surpassing all of 2024 and nearly doubling 2023’s total.
- Smaller, well-funded AI startups are driving most leasing activity, favoring short-term, flexible office deals.
- Class-A space is in high demand, as AI firms prioritize in-person collaboration and high-performance environments.
- Major players like OpenAI and Salesforce are expanding, signaling AI’s growing role in NYC’s tech-driven office rebound.
AI Quietly Moves In
Big Tech has long dominated headlines with mega-leases in Manhattan. Meanwhile, AI companies have been steadily expanding their footprints in New York City. Now, 2025 marks a clear turning point for the sector, reports Bisnow.
According to Savills, AI-focused firms signed 486K SF of leases through Q3 2025. That’s up from 414K SF in 2024 and 265K SF in 2023.
This surge reflects both growing investor confidence in the sector and AI’s increasing operational need for collaborative, in-person workspaces.
Small Tenants, Big Impact
The majority of deals are from smaller and midsize firms, according to Savills and real estate firm Okada & Co., which closed 10 AI tenant deals this summer — mostly under 5K SF.
“These companies are well-funded and nimble,” said Okada & Co. CEO Christopher Okada. “They’re signing shorter leases with room to expand, and they’re fueling a key segment of the leasing market.”
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Flexibility Over Footprint
Unlike traditional long-term corporate leases, many AI companies are opting for 2- to 3-year terms with expansion clauses. The flexibility appeals to fast-growing startups flush with venture capital, yet cautious amid rapidly evolving AI technologies and hiring trends.
While these leases represent smaller footprints, demand is high: Savills estimates that AI tenants are currently searching for another 480K SF of space in NYC.
Big Names, Big Bets
Larger players are also in expansion mode:
- OpenAI leased 90K SF at the historic Puck Building in late 2024.
- Sigma Computing took 64K SF at One Madison Ave.
- Salesforce added 71K SF at 3 Bryant Park just last month.
Meanwhile, Amazon has added over 1M SF of office space in the city over the past two years, with its AI teams part of the broader return-to-office strategy.
Office As A Productivity Tool
A majority of AI leasing activity — 54% — has taken place in Class-A buildings, according to Savills. Newmark’s Liz Hart notes that many AI firms prioritize high-quality, collaborative spaces to boost innovation and productivity.
“These companies believe in the power of in-person work,” Hart said. “They’re using office space as a strategic advantage — not just a cost center.”
What’s Next
With $252.3B invested in US AI companies in 2024 alone, according to Stanford University data, and demand showing no signs of slowing, New York’s AI leasing surge is expected to continue.
Newmark is currently tracking 50 active tech tenants in the NYC market. Of those, 41% are expanding — further evidence that AI’s quiet growth spurt is becoming a long-term force in the city’s office market.
