London’s Future: AI-Driven Office Demand

• Technological development continues to transform London’s business landscape, through the growth of tech sector leasing commitments and strategic digital enablement across the diverse industry base
• Artificial Intelligence (AI) has been drawn into focus as an expanding occupier segment which exhibits significant scale in London, relative to other internationally-leading AI centres. AI-led companies have taken c.1.5m sq ft of Central London office space since 2015 and grown in dominance, accounting for 34% of tech take-up in 2025
• Transactional data suggests that AI firms are growing at an unprecedented rate, hence flexibility is high on their agenda. The locational distribution indicates the value of accessibility and connectivity ahead of a clear submarket preference
• London could reach a total of 4.0m sq ft market take-up from AI companies by 2033; which would mean up to 2.5m sq ft further take-up over the next eight years. This baseline demand scenario represents scale equivalent to 43% of the Central London office pipeline (under construction and available to let)
• Tech recruitment will be a significant driver for near-term jobs growth, as tech skills are increasingly of value and embedding across the breadth of London’s economy. We can also expect new demands regarding the ‘look and feel’ of the workplace to evolve alongside new, tech-driven ways of working for all occupier sectors
• As a result, office markets like London that have a strong and growing AI foothold and robust access to international talent will be able to capitalise on the next wave of growth from the tech industry, while markets without could fall behind

London’s fundamentals have underpinned its historic growth, but the city continues to transform and innovate.

Rapid technological development has been a key contributor to the transformation of cities worldwide and has fuelled the evolution of London’s real estate for several decades. Supported by a strong legacy and competitive global standing, new technological innovations present a continued opportunity for the London market to thrive.

AI technologies are currently at the forefront of industry progress and could influence London's global positioning and its corporate real estate, as the market continues to mature. This report outlines the influence of AI on the London market to date and CBRE’s near-term expectations for the volume and scope of office demand fuelled by AI; in the next stage of growth for the tech sector.

London is a powerhouse tech market

London qualifies as a ‘Powerhouse tech market’ determined by its depth of talent and innovation, access to capital, and maturity of ecosystems across a range of tech workstreams.

The tech industry in Central London has grown through local and international expansion, alongside the urbanisation of innovative sectors. This has been exemplified by the movement of tech companies inwards from suburban markets.

Given this backdrop, London has the momentum to support continued growth in the tech sector. It is well placed to capitalise on new and pioneering innovations such as the advent of AI, which is expected to play a growing role in enhancing the capabilities of London-based businesses.

The growth of rich tech capabilities has transformed the office market

The draw to London by the tech sector has been a significant driver of the diversification of London’s occupier base, as tech tenants have accounted for a growing proportion of its office demand.

London offices saw a surge in requirements from technology occupiers, reflected by a strong uptick in take-up in 2013. Technology companies have leased 17.9m sq ft of office space across Central London since 2013, predominantly focused in the City, West End, and Midtown markets. From 2013 to 2025, tech take-up represented 11% of the total Central London take-up (up to 19% in any individual year), compared to 5% in the period from 2000 to 2012.

And demand is persisting – at the end of 2025, CBRE tracked 0.6m sq ft in active Central London office requirements from the tech sector, representing 9% of the Central London total.

Office take-up by the tech sector, Central London

London is the European destination of choice

Tech companies can benefit from London’s holistic appeal and cluster alongside existing major tech players whose investment and occupation have underpinned the growth of the wider community.

Across a sample of the major mobile-app era tech giants, leasing since 2010 has exceeded 5.0m sq ft in Central London; representing more than their space-takes within many peer European cities.

In the era of AI, this momentum has not slowed. Both established and fast-growing major tech firms have been making commitments to deploy capital and occupy offices in the UK and London for more than a decade.

Take-up by a sample of major mobile-app era tech giants in European cities, 2010-2025

The hiring of tech talent is not limited to tech companies

Data from LinkedIn Talent Insights shows that the recruitment of technology and AI skills in London is growing, and the hiring demand for these professionals is very high. London occupiers are able to attract and retain talent from global origins, further supported by London’s widespread appeal; from economic potential to lifestyle vibrancy and cultural identity.

In turn, talent inflows should translate into corporate demand for London offices, given that skilled workforce availability is a key determinant for companies investing in London*.

Notably, the data shows that the hiring of tech talent spans wider than core tech verticals, including higher education, banking and financial services. London has the highest concentration of net tech employment (defined as technology professionals across every sector, and business professionals employed in tech) of any metro area in the UK and also the highest year-on-year growth.

The application of tech and demand for the relevant skills across a range of business sectors suggests that growth in tech-led jobs will continue to drive market demand. This will also bolster London’s resilience, avoiding over-exposure to a single vertical, such as early software development workstreams.

Top 10 industries employing technology talent in the London area

Rise in AI talent shows direction of travel

The same patterns are demonstrated further by the profile of professionals who are currently located in London, split by title. While software engineering roles make up the leading share of the talent pool, London hosts a diverse range of active professionals.

This includes multiple senior leadership positions which indicates the presence of large corporations, plus London’s strength as a headquarters or regional centre for international companies. More AI companies from London expanded internationally than from any other city globally in the period post-pandemic, demonstrating the global operations and growth potential behind many London-based businesses.

The number of AI engineers has been growing faster than any other job title (demonstrating one-year growth of c.52.5%); further demonstrating the significance of AI for market activity.

Top 20 most common titles among tech talent in the London area

Top 20 fastest growing titles among tech talent in the London area

Innovation supported by ongoing private investment

Capital flows into London are highly diverse; reflecting the dynamic business landscape and propensity for innovation. Recent VC inflows reflect the city’s broad economy base, while at the same time demonstrating the significance of tech as a growth driver.

VC funding volumes from PitchBook indicate substantial inflows for tech-related sectors, which we calculate have represented 59% of London’s total VC since 2019.

Private investment is also contributing to the rapidly maturing AI industry in the UK. AI and Machine Learning accounted for over $57bn of VC investment (3% of the London total) during the same period. Sources of evidence differ based on industry classifications, for example Dealroom indicates that in the first half of 2025, AI accounted for 30% of all UK VC.

Investment into London is also at competitive volumes relative to other cities. London ranks as the dominant city in Europe and third globally by AI VC inflows since 2023.

Recent investment into London’s tech and AI companies suggests that the sector will continue to develop and mature in the near-term.

Total VC investment into companies headquartered in London by vertical (top 25 only), 2019–2025

AI VC Invested by City, 2023–2025

Government initiatives are supportive of further growth

In a global context, the UK is well-positioned to capitalise on the opportunity presented by AI, by embracing the reputable regulatory system and the relative freedom to implement pro-growth initiatives.

AI development in London and across the UK has been leveraged by government initiatives targeting growth, in addition to private investment. Early initiatives such as the world’s first AI Safety Summit hosted in the UK in 2023 put the nation on the map at the forefront of AI development and regulation. There are several new and ongoing policies which aim to further bolster the UK’s status as a global AI hub, and address some of the potential challenges for future growth. These include the direction of public spending towards the sector, including the recently announced record funding grant for £2.5bn towards UK AI and quantum technologies, to anchor and support the world’s most promising companies as they scale in the UK.

While much of the existing government policy has nationwide targets, London stands to benefit disproportionately given the concentration of national institutions, deep capital markets, and economic and demographic potential within the city.

London’s AI activity compares strongly with global peers

PitchBook data shows that there are currently 5,177 AI companies with a London presence. Of these, 54% are headquartered in London, and 30% have 50 employees or more.

London’s AI network is significant in scale relative to its peer cities who are also well known for having leading AI industries. By this metric, London is by far the dominant European market for AI and one of the leading global cities. London has fewer headquartered firms, but more with 50+ employees than San Francisco – the leading AI market globally.

London hosts a smaller proportion of home-grown firms compared to markets like San Francisco, New York, and Paris, exemplifying that it is a key entry point to Europe for international AI firms.

PitchBook data also shows a deep maturity of revenue generating companies in London – totalling 93% of the market, with the remaining 7% profitable companies (2%) or startups (5%). This reflects that the landscape is maturing, but still at an early stage of growth.

Number of AI companies in London relative to a selection of peer cities with leading AI industries

	San Francisco	New York	London	Paris	Berlin
AI Companies with presence in the city	6,263	5,398	5,177	1,578	1,111
AI companies headquartered	3,875	2,959	2,806	919	636
AI companies present with 50+ employees	1,329	1,511	1,531	458	301
AI companies with 50+ employees, founded and headquartered in the city	605	504	428	178	86
Proportion of AI companies with 50+ employees, which were founded and are headquartered in the city	46%	33%	28%	39%	27%

Locational decisions align to key transport networks

The locational distribution of AI companies in London is broad but unsurprisingly shows some alignment with mature tech clusters such as Old Street, Soho and Canary Wharf.

Occupational patterns are clearly demonstrating an East to West spread, mirroring key transport routes such as the Elizabeth line. This is consistent with broader occupier demands for accessibility, which we observe as a priority for building and location selection.

This trend demonstrates that the opportunity for further demand from AI occupiers lies across the breadth of the London market. Simultaneously, this pattern should maintain economic diversity and resilience across individual London submarkets.

The map depicts companies situated within the CBRE Central London boundary. However, the implementation of the London Growth Plan could drive future activity in key innovation districts such as Stratford and White City, alongside increased emphasis on the King’s Cross/Euston Knowledge Quarter.

Distribution of Al companies with 50+ employees, founded and headquartered within the CBRE Central London boundary

High growth AI companies favour flex space

Given that a significant number of London’s AI firms are early-stage or have fewer than 50 employees, there is a large amount of leasing activity at the smaller end of the market.

Looking at a sample of 100 top London-based AI startups, a clear preference for flex space is evident. Of the 100 AI companies, 75 have their office occupation within a flexible office, 9 are in traditional office space and 16 have no Central London office presence (either located in an office outside of Central London or fully remote).

According to CBRE Flex analysis, flexible offices represent 12% of the total Central London office market and the market is expected to continue growing. Therefore, the London market is well-positioned to provide the right type of office at any stage of business growth.

London office occupation of a sample of 100 AI startups

Flex activity offers a clear signal of future office demand

The frequency of AI companies choosing flexible space is further evident in CBRE’s flex occupier transactions. Although not reflective of the entire market, these alone show the acquisition of c. 60,400 sq ft flex space by AI companies since 2020.

While many AI occupiers may choose to locate within flex offices to complement employee preference for flexibility, or access the amenities these spaces provide, this largely reflects the high-growth nature of many AI companies.

As such, we have observed many AI companies mature and grow out of flex into traditional offices at an unprecedented rate. For example, OpenAI initially started their London operation at Fora’s York House location in King’s Cross, but have subsequently signed to take just under 100,000 sq ft of traditional space at Jahn Court (also in King’s Cross). Other notable examples include Synthesia, who have recently acquired 19,500 sq ft at 20 Triton Street, and Quantexa, who acquired c. 52,300 sq ft for a new global headquarters at The Delft.

We can expect flexibility to remain a high priority for many AI occupiers as they move into traditional offices, which could see demand directed towards flexible lease structures or agile and managed landlord solutions.

CBRE occupier transactions within flex offices for AI companies, Central London

The AI industry represents a growing share of office leasing by the tech sector

We estimate that AI‑led companies have taken c. 1.5m sq ft of traditional office space across the Central London market since 2015, representing 11% of the tech sector’s total take-up over the period.

AI is becoming a growing driver of tech industry take-up – accounting for more than a third (34%) of take-up in 2025, compared to 4% of tech leasing in 2015.

At the end of 2025, there were 10 active requirements originating from AI companies looking to acquire traditional offices; 277,500 sq ft in total, which could lead to a continuation of steady take-up by AI occupiers in the near-term.

This analysis excludes a large proportion of the AI-related leasing activity from companies who are not predominantly AI-led but use AI in their working practices. Therefore, it is likely that the true scale of AI-driven space-takes is even greater.

Office take-up by AI as a proportion of tech industry activity, Central London