Intelligent Investment
AI & Office: The Case for Staying in the Market
Capital Markets Conversations
July 29, 2026 10 Minute Watch
In this episode of Capital Markets Conversations, CBRE's National Office Partners leaders Matt Carlson and Patrick Gildea and CBRE real estate tech expert Colin Yasukochi explore what AI means for the office sector and investors navigating today’s market.
The conversation should ease anxieties around AI's impact on office demand, pointing to strong leasing fundamentals, historically low new supply and the long-standing pattern of technology creating new jobs even as it displaces others. The discussion also looks at how markets with the highest concentrations of knowledge workers, including San Francisco, Boston and New York, are likely to be the most adaptive to technological change. At the same time, asset characteristics—particularly location—will be even more important as credit quality of tenants comes into focus amid disruption.
Summary
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Head of U.S. Investor Research
Vice Chairman, National Office Partners
Executive Director, Tech Insights Center
- Office fundamentals tell a different story than the headlines.
Leasing activity and absorption through mid-2026 point to a continued market recovery. The composition of jobs, not just the number, matters as AI evolves, and the office market has historically proven to be resilient during periods of disruption. - The markets most exposed to AI disruption may be the best positioned to benefit.
Cities with high concentrations of knowledge workers, including San Francisco, Boston and New York, have track records of adapting to new technology and generating new industries. Investors should monitor tenant credit quality in AI-heavy markets, where early-stage company concentration poses risks. - AI is shaping investor sentiment, but fundamentals are driving the deals.
Occupiers have demonstrated that they value the office for culture, collaboration and ideation, with rents hitting new highs in most major U.S. markets. Some investors using AI uncertainty as a reason to stay on the sidelines are repeating a posture from prior cycles; other investors, focused on the right product in the right markets, are moving forward. - Asset selection is the defining variable.
The best buildings in the best submarkets, with proximity to knowledge workers and amenities, will remain resilient even if tenants reduce their footprints over time. Markets with highly educated, skilled workforces are the most likely to adopt AI productively, sustaining demand in the locations and building types positioned to serve them.
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