Artificial intelligence companies are emerging as a significant driver of office space demand in London, offering a boost to landlords amid concerns that technological shifts might reduce the need for traditional office environments. Data from Knight Frank shows that AI-related firms have leased 661,100 square feet of commercial space in London so far this year, with projections suggesting the sector will occupy around one million square feet throughout 2026. This figure represents roughly twice the office space leased by AI companies in 2025 and is equivalent to about two fully occupied buildings the size of the Gherkin.

Philip Hobley, head of London offices at Knight Frank, described AI businesses as “one of the defining new sources of demand” for prime London office space. He noted that these firms are quickly maturing, moving from flexible, early-stage setups to substantial, permanent headquarters as they secure funding, grow revenues, and expand their teams. Examples include Anthropic, the U.S.-based developer of the Claude chatbot, which has committed to 158,000 square feet at British Land’s One Triton Square near Euston, and OpenAI, owner of ChatGPT, which recently leased 89,500 square feet in two King’s Cross buildings.

Toby Courtauld, chief executive of the London office developer GPE, highlighted the influx of AI companies establishing a presence in the city. He framed this trend as a sign of broader economic confidence, stating that “real estate is the most tangible measure” and emphasizing that AI presents a growth opportunity rather than a threat to London’s economy.

Knight Frank also identified other high-tech firms actively seeking office space in London, including Harvey AI, which provides contract review technology for law firms; Celonis, a German tech unicorn; and Nebius AI, which recently secured a $2 billion investment from Nvidia. Chris Vydra, executive director at commercial property services firm CBRE, remarked on London’s appeal as a destination for AI companies entering the European market, noting it is preferred over cities like Berlin and Paris.

Much of this demand is concentrated in London’s “knowledge quarter” around King’s Cross, Euston, and Fitzrovia, areas noted for their access to transport links, universities, research institutions, policy networks, and a broader technology ecosystem. According to Chris Dunn, a researcher at Knight Frank, proximity to this talent pool and research infrastructure is becoming as critical to AI firms as traditional office specifications such as floorplates and building quality.

This surge in demand is expected to continue driving up rents for London’s prime office space, which are already at record levels amid limited availability and slower development since the pandemic. Knight Frank estimates prime rents in the City have risen 46 percent since 2020, while West End rents have increased 68 percent over the past six years. The scarcity of available space has led some AI companies to sign leases for buildings still under construction, committing years in advance to secure their presence in the capital.