- AI leasing demand helped BXP reach 1.1M SF leased across 68 transactions in Q1.
- BXP’s overall portfolio occupancy rose to 87.4%, with AI-driven firms fueling growth.
- San Francisco and New York saw notable leasing activity from AI companies, with up to 80% of demand in SF attributed to tech and AI.
- BXP completed $495.7M in non-strategic asset sales as part of its ongoing portfolio optimization.
AI Companies Drive Leasing Gains
According to Bisnow, BXP reported strong office leasing momentum in Q1, largely powered by artificial intelligence demand. The firm’s central business district properties were 89.9% occupied and 93.4% leased, with tech and media comprising roughly 20% of its tenant base. AI-driven firms, in particular, played a notable role in boosting both leasing and occupancy rates across top cities, according to BXP’s quarterly earnings call.
Impact Across Major Cities
Leasing demand tied to AI companies surged in core locations like San Francisco, New York, and Seattle. In San Francisco, the share of leasing by tech and AI groups climbed from 50% to nearly 80% through Q1. In New York, AI companies accounted for about 415K SF of the 8.5M SF leased, with 55% of AI tenant leases dedicated to future expansion. An existing AI tenant expanded to another floor at 360 Park Avenue South, lifting occupancy at that tower to 95%.
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Portfolio Optimization Continues
To further strengthen its portfolio, BXP executed over $495.7M in residential, land, and non-strategic office sales in Q1, including assets in San Jose, Boston, South San Francisco, and Bethesda. These dispositions are part of BXP’s larger plan to raise approximately $1.9B by 2028 and optimize holdings for long-term growth. At the same time, development activity in core markets continues to reinforce confidence in premium office demand, especially in high-visibility urban corridors.
What’s Next
BXP leadership remains confident that AI leasing growth will support office demand in major markets—even amid industry concerns about the technology’s impact on jobs. While investor jitters persist due to macroeconomic and AI-related uncertainties, BXP reports that new and growing AI organizations are now a key source of incremental office demand. The company expects the trend to continue in the near term as AI-driven businesses pursue in-office work strategies.
