In our latest VTS Office Demand Index (VODI) report, we highlighted a nearly 20% year-over-year (YoY) growth in national office demand. Certain benchmark markets, such as New York City, even reached pre-COVID demand levels by November 2024. Overall, 2024 proved to be a transformative year where demand expanded across every major U.S. market.
As we look toward 2025, the central question for the industry is: What can we expect for the office market this year? We anticipate a bifurcated recovery—while specific markets are poised for meaningful growth, others will find their footing with more modest, incremental gains.
The 2025 Global Leasing Forecast
VTS has analyzed our proprietary office demand data, the industry’s only real-time predictive dataset and the earliest leading indicator of leasing activity, to forecast trends across three of the world’s most influential markets. These cities remain prime institutional investment targets for the next 18–24 months due to their high concentration of capital and talent.
| Market | 2025 Leasing Forecast | Expected YoY Change | Strategic Outlook |
| San Francisco | 9M Square Feet | +28% (Growth Pick) | Climbing out of post-COVID deficit; high AI-sector momentum. |
| New York City | 34M Square Feet | Single-Digit Growth | National leader in demand; high-volume stabilization. |
| London | Decline Anticipated | Negative | Muted near-term; likely to beat expectations if rates cut. |
Market Deep Dives
San Francisco: The 2025 Growth Pick
San Francisco is our standout pick for 2025. We forecast leasing activity to rise by 28% as the market aggressively recovers from its post-COVID deficit. This surge is expected to bring the city’s yearly leasing total to 9 million square feet.
New York City: Reaching the Plateau
New York remains a testament to urban resilience. By year-end 2024, it secured the highest office demand of any major U.S. market. While we expect a massive 34M square feet to be leased in 2025, this represents modest percentage growth simply because the market has already rebounded so significantly.
London: The Muted Near-Term
London is currently the only market where we anticipate a YoY decline. A temporary lack of new demand in the leasing pipeline is impacting our forecast. However, London remains the market most likely to outperform these projections if interest rate cuts stimulate demand in the latter half of the year.
Accountability: Reviewing Our 2024 Predictions
Precision matters in forecasting. During our inaugural forecast last year:
- NYC: We hit the mark with almost exact precision as leasing expanded by 30%.
- San Francisco: While slightly optimistic, the market still delivered excellent growth.
- London: Actual performance saw a modest decline rather than the slight growth we anticipated.
Data-Driven Advantage with VTS 4
Launched last year, VTS 4 brings this predictive market data directly in-app for our customers. By utilizing advanced commercial real estate lease management software with built-in predictive intelligence, owners and brokers can:
- Understand leasing trends 6–12 months before they are recorded.
- Track deal economics and pricing trends before leases are even signed.
- Identify active demand shifts in real-time.
Ready to lead the transformation?
Click here to learn more about VTS, schedule a demo, and talk to us about our forecasts for other major gateway markets.
