---
title: "AI tenants and the Class A demand picture"
description: "How frontier AI labs and platform AI tenants are reshaping Class A demand in gateway markets."
canonical: https://classa.info/guides/ai-tenants-and-class-a-demand
pageType: guide
lastUpdated: 2026-04-01T00:00:00.000Z
license: "CC BY 4.0 with attribution to Class A Atlas (https://classa.info)."
---

> AI tenants are the cycle's marginal demand engine — concentrated in SF, NYC, London, Toronto, Tokyo.

## TL;DR

- AI tenants are the cycle's marginal demand engine — concentrated in SF, NYC, London, Toronto, Tokyo.
- Underwriting profile is unique: large headcount ramps, dense seat plans, heavy power and HVAC requirements.
- Frontier labs increasingly negotiate full-floor expansion stacks rather than single floors.
- ESG and amenity performance now table-stakes — but power capacity is the binding constraint.
- Landlords with surplus power and chilled-water capacity are commanding measurable rent premiums.

# AI tenants and the Class A demand picture

By The [Class A](/glossary/class-a) Atlas Editorial Desk · 2025-10-01T00:00:00.000Z · 10 min read

**How frontier AI labs and platform AI tenants are reshaping Class A demand in gateway markets.**

## TL;DR

- AI tenants are the cycle's marginal demand engine — concentrated in SF, NYC, London, Toronto, Tokyo.
- Underwriting profile is unique: large headcount ramps, dense seat plans, heavy power and HVAC requirements.
- Frontier labs increasingly negotiate full-floor [expansion](/topics/cross-border-expansion) stacks rather than single floors.
- ESG and amenity performance now table-stakes — but power capacity is the binding constraint.
- Landlords with surplus power and chilled-water capacity are commanding measurable rent premiums.

## Demand picture

AI labs and platform AI vendors became the largest single source of Class A absorption in 2024–25 in San Francisco, with material spillover into New York (Hudson Yards, Midtown South), London (Shoreditch tech belt, Kings Cross), Toronto (King West, Liberty Village), and Tokyo (Roppongi, Shibuya). The defining feature of these requirements is an aggressive 24-month headcount ramp: tenants taking 50,000 sqft today underwrite 150,000 sqft in 18 months.

## Underwriting profile

AI tenants typically run dense seat plans (60–80 sqft per seat versus the Class A average of 120–150), heavy in-floor power requirements (15–25 W per sqft versus a typical 6–8 W), and elevated HVAC loads from on-floor compute. Many require Tier III equivalent power and HVAC redundancy on a portion of the floor for in-floor inference and dev infrastructure.

## Power as the binding constraint

The gating Class A factor for AI tenants is no longer rent or amenity — it is power capacity. Landlords with surplus primary-power feeds, expandable risers, and chilled-water capacity are commanding measurable rent premiums. The fastest-growing Class A capex line item across our coverage cities is power infrastructure upgrade.

## Lease structure

Frontier AI labs increasingly demand full-floor expansion stacks (hard expansion rights on three to five contiguous floors above the initial premises) rather than the standard single-floor [expansion option](/glossary/expansion-option). Landlords accommodate by carving out blocks of building NRA at signing, often at premium pricing.

## Frequently asked questions

****Are AI tenants creditworthy?****
: Frontier AI labs typically come with significant fundraising covenant rather than operating cash-flow covenant. Landlords increasingly require letter-of-credit security packages 18–24 months of base rent rather than the standard 6–12.

****Do AI tenants need data-centre infrastructure on the floor?****
: Most do not — production training runs in dedicated data centres. But the on-floor inference, dev, and dense compute racks require power and cooling beyond standard Class A specifications.

## Editorial provenance

Reviewed by [**Class A Atlas Editorial Desk**](/about/authors/class-a-atlas-editorial-desk) — House byline · global editorial team. Last updated 2026-04-01. See our [methodology](/about/methodology) and [editorial standards](/about/editorial-standards).

### Primary sources for this page

- [CBRE Marketview reports](https://www.cbre.com/insights) — CBRE
- [JLL Office Insight](https://www.jll.com/en/trends-and-insights) — JLL
- [Cushman & Wakefield Marketbeat](https://www.cushmanwakefield.com/en/insights) — Cushman & Wakefield
- [Savills World Research](https://www.savills.com/research_articles/) — Savills
- [Colliers Global Office Outlook](https://www.colliers.com/en/research) — Colliers

[Full sources index](/about/sources) · [Submit a correction](/about/corrections)

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Citation: Source: Class A Atlas (https://classa.info/guides/ai-tenants-and-class-a-demand), updated 2026-04-01T00:00:00.000Z.