San Francisco Office Market Report

Leasing gathering steam, aided by tech tailwinds. After years of muted performance, San Francisco’s office market is showing firm signs of recovery. Quarterly net absorption remained positive throughout 2025 for the first time since 2018, and momentum is poised to carry into this year. Office demand growth in downtown San Francisco has been strong, aided by the core’s emergence as an epicenter of the AI start-up ecosystem. Firms such as Anthropic and Abridge AI have recently signed downtown leases, while OpenAI is reportedly exploring additional space this year. San Mateo County is also attracting healthcare and robotics startups, including Neuralink, Nurix, and Skild AI, though vacancy compression trends there have been less evident, partly because of much lower overall vacancy rates. If tech momentum holds, the metro should continue to recover and is positioned to see the largest vacancy compression nationwide in 2026.