Artificial intelligence firms are driving a resurgence in Manhattan office leasing, contributing to the strongest year in over a decade for demand in office space. Manhattan leasing hit 42.9 million square feet last year, with some of Silicon Valley's leading AI firms among the most active tenants. Companies like OpenAI and Palantir have been hiring in New York City, despite consumer fears about the new tech. Tech and AI tenants accounted for a third of the largest new leases in Midtown South last year. However, vacancies remain a significant issue for older office complexes. In 2025, AI firms added roughly 1 million sq ft of office space across Manhattan, a 152% increase from the previous year, and are planning to add another 1.4 million in total. There are concerns that AI technology could eliminate entry-level roles and lead to mass layoffs.