Seattle’s AI Office Growth Offers a Smarter Lesson for Boise Landlords

Artificial intelligence companies are signing large office leases and attracting plenty of attention. But the most visible tenant category is not always the one carrying the market.

Seattle’s recent leasing activity shows that an office recovery can be stronger when demand comes from several industries instead of one fast-growing sector. That is an important lesson for Boise commercial real estate owners, developers, and tenants.

According to analysis by Elliott Krivenko for CoStar, AI companies are expanding rapidly in Seattle and Bellevue. However, professional services, healthcare, law, engineering, and other traditional industries still account for most of the region’s newly leased office space.

AI Is Growing, but It Does Not Control Seattle’s Market

Several major AI-related leases have helped improve the outlook for Seattle-area office properties.

OpenAI opened its first Seattle-area location in Bellevue in 2025. The company expanded the following year, bringing its space at City Center Plaza to more than 272,000 square feet.

Other notable leasing activity includes:

• Databricks signed a 160,000-square-foot lease in Bellevue, increasing its regional footprint to more than 270,000 square feet.
• Anthropic leased 113,000 square feet at Dexter Yards in Seattle.
• The Allen Institute for AI leased nearly 50,000 square feet at Northlake Commons and more than doubled its presence.

These are significant transactions, but they do not represent the entire market.

Since the beginning of 2025, companies focused primarily on AI have accounted for approximately 10% of newly leased office space across the Seattle region. If businesses with major AI operations are added, that share increases to nearly 25%.

That still means other industries generated roughly three-quarters of the region’s new leasing activity.

Seattle’s story is very different from San Francisco, where AI and related companies have been responsible for more than half of new office leasing. In some recent quarters, AI companies alone represented approximately 60% to 70% of the square footage leased there.

San Francisco’s office recovery is closely tied to one rapidly expanding sector. Seattle’s recovery is supported by a wider tenant base.

Diverse Tenant Demand Can Make a Market More Resilient

Professional services firms generated 40.4% of Seattle’s office leasing during the previous year, according to the CoStar analysis. That was nearly twice the sector’s average share during the prior decade.

Healthcare organizations also increased their presence. Their share of office leasing rose from 7.6% to 12.5% in one year.

That diversity matters because industries expand and contract at different times. If one sector slows, another may continue leasing. A market supported by law firms, engineers, consultants, medical groups, financial firms, and technology companies may be better positioned to absorb economic changes.

AI’s influence may also be broader than the tenant classifications suggest. Traditional employers are adding AI teams and technology functions inside their existing businesses. Some office demand categorized as healthcare, professional services, or another industry may still be partly connected to AI growth.

For landlords, this means tenant demand cannot always be understood by looking only at company labels. An engineering firm, hospital system, or consulting company may need more office space because it is building new technology capabilities.

For tenants, competition from expanding industries can affect the availability and cost of high-quality space. The strongest demand often concentrates in modern buildings with efficient layouts, good amenities, parking, and access to skilled workers.

Local Insight: Boise Should Focus on the Full Tenant Base

The Boise office market should not wait for one headline industry to create a broad recovery.

Boise and Meridian have a diverse collection of office users, including healthcare providers, state government, professional services, financial companies, engineering firms, real estate businesses, education groups, and technology employers. Those everyday users may be more important to long-term occupancy than a small number of attention-grabbing leases.

That creates several practical lessons for Boise commercial real estate.

First, landlords should market office space to more than one industry. A building designed only around traditional corporate tenants may miss demand from medical, educational, government, nonprofit, or technology-related users.

Second, older buildings must compete on functionality. Tenants want efficient floor plans, dependable heating and cooling, modern internet service, convenient parking, natural light, and spaces that help employees work together. Cosmetic improvements alone may not solve a poor layout or outdated building systems.

Third, Boise development should be based on proven tenant demand. Developers should be careful about starting speculative office projects simply because one industry appears to be expanding. Preleasing, flexible designs, and the ability to divide space can reduce risk.

Fourth, landlords should pay attention to how existing companies are changing. A law firm, healthcare group, or engineering company may not describe itself as an AI business, but it may still need new space for technology teams, secure data operations, training, and collaboration.

My take is that Boise does not need one industry to rescue its office market. It needs consistent leasing from a broad range of growing local businesses.

AI may become a larger part of Boise’s economy, especially as technology, semiconductor, data, and professional service companies expand. But the healthiest outcome would be a market where demand comes from many sources.

Seattle offers a useful reminder: the tenant making the biggest headline may not be the tenant doing most of the leasing. Boise office owners should follow the full demand picture, improve the spaces tenants actually need, and avoid building an investment strategy around a single trend.

Mike Gioioso (joy-OH-so) has for 16+ years been helping companies of all sizes buy, build, and lease perfect places for business in greater Boise, Idaho and beyond.
www.streetsmartidaho.com mike@streetsmartidaho.com 208-209-9166

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