Office leasing activity during 2025 was up by 5% from one year before, according to a new data report from CoStar Group (NYSE: CSGP).
Last year, office tenants signed for an estimated 410 million square feet of space. This was a significant reversal from 2024, when leasing volume fell to its lowest level in 15 years (excluding the pandemic year of 2020). Last year closed with three consecutive quarters of volume exceeding 100 million square feet – a first since the opening three quarters of 2022.
At a market level, Boston saw the largest year-over-year growth in leasing activity with a 52% spike, lifting the city’s annual volume to its pre-pandemic five-year average. San Jose and San Francisco followed with a 40% gain in the metric, which was attributed to demand from artificial intelligence firms. On the flip side, the markets with declines in leasing activity include Seattle, Atlanta, Houston, and Philadelphia.
“Despite the rebound in 2025, leasing activity has yet to return to the level seen in the late 2010s,” said Phil Mobley, national director of office analytics at CoStar Group. “While transaction activity is near its all-time high, with approximately 30,000 lease deals last year, the average lease size was roughly 3,500 square feet – more than 15% smaller than the five-year pre-pandemic average.”
