Artificial intelligence firms are becoming one of the biggest drivers of flexible office demand in London, according to new research from CBRE, as fast-growing startups increasingly prioritize short-term flexibility over traditional leases.
The report found that AI companies accounted for 34% of London tech office take-up in 2025, up sharply from just 4% a decade ago.
AI Startups Lean Heavily on Flexible Space
CBRE analyzed 100 leading AI startups based in London and found that 75 currently operate from flexible workspaces. Only nine occupy conventional office space, while the remaining firms either work remotely or outside Central London.
According to the report, many AI firms are choosing flexible workspace because it allows them to move quickly, scale headcount unpredictably, and access fully fitted offices without long-term commitments.
Amenity-rich environments and immediate occupancy are also becoming increasingly important for startups competing for talent in London’s crowded tech market.
Flexible offices now account for roughly 12% of the total Central London office market, according to CBRE’s European Flex Office Market Update 2025.
Flex Space Often Becomes a Stepping Stone
While many AI firms begin in coworking or managed office environments, CBRE noted that some later transition into traditional office space as they expand.
The report highlighted companies including OpenAI, which initially operated from a flexible workspace before later signing approximately 9,300 square meters of traditional office space in London.
Other AI firms mentioned included Synthesia and Quantexa, both of which secured larger office footprints as their operations grew.
London Flex Demand Expected to Stay Strong
Demand for flexible offices across London is expected to remain elevated throughout 2026, supported by limited office supply, continued AI expansion, and more adoption of flex space by larger occupiers.
The report noted that constrained development pipelines across areas including the City and West End are pushing companies toward fitted and flexible office options earlier in the leasing process.
Corporate demand for flex space is also rising as businesses seek temporary expansion space, faster occupancy timelines, and greater flexibility while evaluating long-term real estate decisions.
