AI Talent Clusters Drive Rent Growth in Major North American Cities

A rapid influx of workers with artificial intelligence skills is concentrating in a handful of North American metropolitan areas and contributing to rising apartment rents, according to a new analysis by commercial real estate services firm CBRE.

CBRE reported that the number of AI-skilled workers in the United States and Canada grew by more than 50% in the past year to about 517,000. Much of that growth is concentrated in the San Francisco Bay Area, New York City, Seattle, Toronto and the District of Columbia—markets that already had among the highest housing costs before the recent hiring surge. Between 2021 and 2024, CBRE data show Manhattan rents rose more than 14%, Washington rents increased about 12%, Seattle rents climbed more than 7% and San Francisco rents rose nearly 6%.

The firm said the income profile of AI workers is helping to absorb higher housing costs for those employees while adding pressure on the broader rental market. CBRE estimated Manhattan AI professionals spend about 29% of their income on rent, while in San Francisco and Washington the share is closer to 19%. New York City added roughly 20,000 AI-skilled workers over the past year, and other metro areas including Atlanta, Chicago, Dallas-Fort Worth, Toronto and Washington each registered increases of 75% or more.

CBRE and industry officials said the trend differs from other recent waves in tech because many AI employers are insisting on in-person work. "AI is predominantly in-office work, and they’re sort of back to the earlier days of tech innovation, where they’re in the office five, six days a week and for long hours," Colin Yasukochi, executive director of CBRE’s Tech Insights Center, told CNBC. In San Francisco, CBRE said one out of every four square feet leased over the past two-and-a-half years went to an AI tenant, signaling a rebound in office demand tied to the sector.

Market participants and analysts said the combination of office-returning AI companies and the arrival of well-paid workers has created a twofold effect: stronger demand for commercial space and increased competition for housing in neighborhoods close to tech jobs. For renters not employed in the AI sector, those dynamics can mean fewer affordable options as landlords and developers respond to heightened demand.

The CBRE findings reflect hiring and leasing patterns through the past year and the broader period from 2021 to 2024. Industry executives point to a clustering effect common to technology revolutions, in which access to talent, capital and research institutions concentrates economic activity in particular cities. In the case of generative AI and related fields, the result has been both office leasing activity and residential demand centered on major metropolitan hubs.

Local housing market responses vary. In some cities, rising rents have been matched by new apartment construction and conversions that aim to increase supply, while in others the pace of new development has lagged demand. Policymakers, housing advocates and municipal leaders have increasingly cited affordability as a key policy challenge in markets where well-paid tech workers are moving in large numbers.

The CBRE report underscores a broader shift in how emerging technology sectors are influencing urban markets: not only do they reshape office occupancy patterns, but they also affect residential real estate and neighborhood-level affordability. The firm’s headline figures—more than 50% growth in AI-skilled workers to 517,000 across the U.S. and Canada and notable rent gains in the largest hubs—frame a market dynamic that local governments, employers and residents continue to confront as hiring and leasing decisions unfold.

As companies refine hybrid and in-office policies and as recruitment for AI roles continues, analysts said housing and office markets in these talent hubs will likely remain a focal point for investors and policymakers tracking the economic impact of the AI sector.