T
ech sector-driven cities are experiencing a surge in office space demand, indicating that tech companies may be reconsidering their remote work policies. This shift is a departure from previous years when the tech industry lagged behind others in terms of office space usage.

    According to the VTS Office Demand Index (VODI), which tracks new tenant tour requirements for office properties in core US markets, demand for office space has increased significantly in tech-heavy cities like Seattle, Boston, and San Francisco. In these cities, annual demand is up 114.3%, 31.4%, and 25% respectively.

    In contrast, non-tech reliant markets such as Chicago, Los Angeles, and New York City have seen more modest growth, with annual demand increases of 14.9%, 8.1%, and 3.4%. However, the gap between remote-friendly cities and those less reliant on tech is narrowing, with a recent drop from 27 to 11 VODI points.

    "Tech giants like Amazon, Salesforce, and Apple are making strategic moves toward bringing employees back to the office," said Nick Romito, CEO of VTS. "The trend shows no sign of slowing down." The Q3 2024 VODI report also notes that nationally, demand for office space increased 11.8% from Q3 2023 but is down 8.1% from Q2 2024.

    Locally, demand for office space was up in all markets tracked except Washington, D.C., which had the lowest demand due to uncertainty surrounding the upcoming presidential election. Major markets like Los Angeles and New York City continue to hold top spots for office demand, despite a recent cooling.