CBRE Report: AI Investment Fuels Office Leasing Recovery Across Major Markets

In Canada tech industry leasing accounted for 32.2% of total leasing in Q1 2026, up from 14.7% in 2025, and higher than any annual share in the last 10 years

Record venture capital investment in artificial intelligence is fueling a rebound in office leasing by tech companies, pushing tech to the forefront of office demand, according to CBRE’s Tech Gateway Office Markets report.

CBRE’s latest analysis shows that AI companies leased 21 million sq. ft. of office space in San Francisco and Silicon Valley since 2019 – equivalent to 15 Salesforce Towers, the tallest building in San Francisco. AI companies leased another 9.4 million sq. ft. in Manhattan, Boston and Seattle over the same period.

In Canada, tech industry leasing accounted for 32.2% of total leasing in Q1 2026, up from 14.7% in 2025, and higher than any annual share in the last 10 years. This early 2026 surge builds on the growth in 2024 and 2025, which saw consecutive years of increasing tech activity. (These stand below the 2018-2020 peak years when US-based technology firms were most active in opening Canadian offices.)

The Tech Gateway Office Markets report notes that since 2020, U.S.-based AI companies have attracted $578 billion in venture capital investment, with the San Francisco Bay Area accounting for roughly 80% of that total. Investment in AI over the past five years has surpassed total venture capital funding across all industries from 2015 to 2019 ($462 billion), highlighting the rapid acceleration of AI-driven growth.

In Canada Toronto received the highest amount of AI VC funding, at US$7 billion between Q1 2020 and Q1 2026. While this lags many US markets like San Francisco, it is closer to being in line with London and Paris.

“AI investment has moved from research and experimentation to large-scale deployment,” said Colin Yasukochi, executive director, CBRE Tech Insights Center. “That shift is translating into meaningful office space demand in markets with deep tech talent and established innovation ecosystems.”

The resurgence in tech and AI leasing is influencing office market fundamentals in several major U.S. markets, most notably Manhattan and San Francisco. Overall office vacancy in those cities declined over the past two years, and net absorption exceeded 3% of total building inventory in 2025 – a high percentage even in periods of economic expansion.

Leasing growth has largely been concentrated in traditional U.S. tech markets, such as Silicon Valley, Manhattan, San Francisco, Boston and Seattle, which collectively doubled their tech-related leasing volumes between 2023 and 2025. More recently there’s evidence that the momentum is spreading into other markets, including Austin and Chicago, which saw increased tech leasing in 2025.

Across Toronto, Vancouver and Montreal, the three Canadian markets covered in the report, all recorded increases in tech leasing in 2025 relative to 2023. Toronto saw 2.4 times more tech leasing in 2025 compared to 2023. Toronto was one of only five markets covered in the report that saw its vacancy rate decrease over the last two years. It also has the fifth lowest office market vacancy among the 17 tech markets profiled in the study behind London, Paris, Vancouver and Manhattan.

“With continued robust AI investment and companies adding more talent, we expect more U.S. and Canadian office markets to benefit from the ongoing expansion of the tech growth cycle,” Yasukochi said.