National Office Downsizing Signals Amazon Shift

National office strategy shifts as Amazon plans to trim millions of square feet from its office footprint, impacting over 14M SF in 2026.

March 5, 2026

Valerija I.

Amazon will cut 49,000 desks, potentially reducing its office space by over 14M SF.
The company targets dropping its office vacancy rate from 31% to below 23% in 2026.
Reductions are driven by evolving workplace strategies and increased AI adoption.
Some footprint cuts will come via lease expirations, subleasing, and ‘hibernating’ offices.

Key Takeaways

Major Reductions for National Office Portfolio

Bisnow reports that Amazon is preparing for a major contraction across its national office portfolio. The company plans to remove 49,000 desks, equal to more than 14M SF of office space. Leadership shared the strategy with Amazon’s global real estate and facilities team in early February. The move signals a significant shift in the company’s office real estate strategy.

By the end of 2025, Amazon controlled 40.2M SF of office space in the US and more than 28M SF internationally. However, much of that space currently sits underused. Management now aims to lower the company’s national office vacancy rate. The current vacancy rate stands near 31% across its portfolio. Amazon plans to reduce that figure to below 23% by the end of the year.

Drivers Behind the Office Cuts

Key factors include a shift in headcount strategy and a broader push for efficiency. The changes follow layoffs and rapid AI-driven transformations. Since returning to the office in 2023, Amazon prioritized spaces that support collaboration and innovation. However, the company eliminated most hybrid work at the start of 2025. These shifts created large amounts of unused space across Amazon’s national office portfolio. Amazon has already cut about 30,000 jobs during the past year.

Similar workforce reductions have already reshaped office demand in Manhattan, where layoffs at major tech employers have recently reduced occupancy across several large office buildings. AI now plays a central role in Amazon’s restructuring. The technology is changing both staffing levels and space needs. As a result, Amazon will reduce leases through expirations, subleasing, and office “hibernation.”

Strategic Expansion and Downsizing

Despite the broad reduction, Amazon will add 1.8M SF of new national office space in markets still considered strategic. The firm is aiming for an ultimate global vacancy target near 11%, but for 2026, the goal is a 22.9% vacancy rate. Management has not disclosed which geographies will see the most impact or a specific timeline.

This move demonstrates how major occupiers like Amazon are rethinking national office requirements in a market shaped by both technological transformation and evolving workforce needs.