Key facts
- AI firms leased over 700,000 sq ft of London office space in the first half of 2026.
- This figure is more than double the amount leased in all of 2025.
- AI companies leased 565,000 sq ft in the first four months of 2026.
- The average monthly lease for AI firms in 2025 was 40,000 sq ft.
- Almost half of AI firm office deals were in the King's Cross and Euston areas.
- Microsoft agreed to lease the 100,000 sq ft Film House in Soho.
Artificial intelligence firms are significantly increasing their footprint in London's office market, leasing more than 700,000 square feet in the first half of 2026. This figure more than doubles the amount leased throughout the entirety of 2025, indicating a substantial surge in demand for high-quality office space within the sector.
Data from real estate analysts CoStar reveals that last month alone, AI model creation companies leased over 450,000 sq ft of office space, a stark contrast to the average of 40,000 sq ft per month in 2025. This trend has seen AI companies leasing 250,000 sq ft by March 2026, up from less than 50,000 sq ft in April 2025.
King's Cross, particularly the Knowledge Quarter, has emerged as a prime hub, attracting major AI players like OpenAI, Anthropic, Alphabet's DeepMind, Google, Meta, and Microsoft. Microsoft recently agreed to lease the 100,000 sq ft Film House in Soho. Experts like Patrick Scanlon, CoStar's senior director of market analytics, view this as a significant moment for the sector, suggesting it's not a bubble but rather a reflection of sustained demand for well-located, quality office spaces.
This expansion is fueled by significant capital raises within UK AI startups, enabling them to secure larger premises. Companies emphasize London's strong talent pool, venture capital access, and the importance of a physical brand presence in attracting and retaining talent. Despite ongoing hybrid work trends, the demand for collaborative spaces remains high.