AI Talent Boom Reshapes North American Real Estate

Insights from Next Move Strategy Consulting

As artificial intelligence continues to expand its footprint, its influence is now reshaping real estate markets across the U.S. and Canada. The surge in demand for AI-specific tech talent is fueling growth not only in office space but also in residential and retail sectors, signaling a structural transformation in urban property dynamics.

A Surge in AI-Skilled Workforce

Between mid-2024 and mid-2025, the pool of AI-skilled tech workers grew by more than 50%, reaching 517,000 professionals, according to CBRE’s analysis of LinkedIn data. This talent is heavily concentrated in the San Francisco Bay Area, New York City, Seattle, Toronto, and Washington, D.C. — with the top three hubs alone accounting for 35% of the national total.

By absolute numbers, New York added the largest influx of AI-skilled workers, with 20,000 new professionals entering the workforce over the past year. Cities such as Atlanta, Chicago, Dallas-Fort Worth, Toronto, and Washington, D.C. recorded year-over-year growth of 75% or more.

This increase is not solely from new job creation; many tech professionals have upskilled to integrate AI-related expertise into their roles, while others entered the workforce already equipped with these capabilities.

Real Estate Ripple Effects

“San Francisco has become ground zero for the AI revolution, where major firms like OpenAI are driving growth,” said Colin Yasukochi, Executive Director of CBRE’s Tech Insights Center.

While Silicon Valley was the heart of the earlier tech era, AI’s momentum is extending beyond traditional hubs into finance, insurance, and real estate (the FIRE sectors). This diversification is fueling new leasing activity in cities like Manhattan, where demand for both office and residential properties is climbing.

Financial services companies, facing heightened competition from AI-driven fintech firms, are now among the most active hirers of AI talent. This is further boosting office demand, even as other areas of the broader tech industry scale back.

Office Space in High Demand

Unlike other forms of technology that have embraced remote work, AI remains in its early innovation phase, requiring more in-person collaboration. In the first half of 2025, tech companies accounted for 17% of U.S. office leasing activity — a sharp rise from 10% in late 2022.

In San Francisco, one out of every four square feet of office space leased in the past 2½ years went to AI companies, according to CBRE.

“AI is predominantly in-office work, with employees often spending five to six days a week on site,” noted Yasukochi. “That intensity has significantly boosted demand for office real estate.”

Housing Markets Feel the Impact

The influx of AI professionals is also influencing residential markets. CBRE data shows apartment rents have climbed across major AI hubs. From 2021 to 2024, rents in Manhattan rose more than 14%, Washington, D.C. increased over 12%, Seattle grew by more than 7%, and San Francisco rose nearly 6%.

Despite steep rent growth, high AI salaries are sustaining affordability. Based on CBRE’s standard of 30% of income to housing costs, workers in Manhattan spend about 29% of their wages on rent, while those in the San Francisco Bay Area and Washington, D.C. pay as little as 19%.

A New Tech-Driven Real Estate Cycle

“This idea that AI is the future of technology — and that it’s still in its early days — is sparking a new wave of migration to cities where AI innovation is concentrated,” Yasukochi explained. “That movement is directly shaping real estate demand.”

AI Talent and Real Estate Market Impact

Office Market Revival

AI’s in-person collaboration needs are reversing remote-work trends. Tech firms now account for 17% of U.S. office leasing, with San Francisco and New York emerging as key beneficiaries.

Residential Market Pressure

The inflow of highly paid AI professionals is driving up apartment rents — +14% in Manhattan, +12% in D.C., +7% in Seattle, and +6% in San Francisco (2021–2024). While AI salaries keep housing affordable for talent, non-tech residents face rising affordability pressures.

Broader Sectoral Demand

Financial services, insurance, and real estate firms are also hiring AI talent, boosting office and residential demand beyond traditional tech hubs.

Conclusion

The AI boom is sparking a new real estate cycle, with concentrated demand for office, housing, and mixed-use spaces in major North American cities.

Source: CNBC

Prepared by: Next Move Strategy Consulting