Bay Area Office Leasing Update – Q4 2025

Bay Area office leasing in Q4 2025 is expected to show continued, though potentially uneven, improvement driven by tech and AI-related sectors. Recent trends from the first half of 2025 indicate a surge in leasing activity, particularly for mid-to-large sized spaces, despite a high overall vacancy rate that is stabilizing or decreasing slightly in certain areas like San Francisco. The South Bay market shows positive net absorption, while the Peninsula market is seeing increased supply but a pickup in tenant and investor activity.