The impact of AI on the office sector

Key takeaways

AI is already influencing how businesses invest, operate and organise work.
The impact of AI on jobs remains uncertain, but over the medium to long term, AI could primarily act as an augmentative technology by improving productivity, increasing firms’ output, creating new capabilities and redeploying labour into higher-value functions.
AI is a structural risk for office markets and its evolution should be watched closely, not treated as a straight-line forecast for weaker office demand.

The release of ChatGPT in November 2022 marked the beginning of the generative AI era. Since then, AI has moved quickly into business, government and consumer use, while attracting significant investment into infrastructure needed to support AI, such as data centres, microchips, product development and enterprise adoption.

For the property sector, the immediate and visible impact of AI is large volumes of data centre development. This investment provides competition for industrial land and could potentially draw investment away from other property sectors including housing, retail and office. The latter’s development could potentially restrict the attention local approvers can pay to rival housing, industrial and office projects.

To form a view of AI’s potential impact on office demand, we need to look beyond broad claims about AI and jobs. The more useful question is which skills, tasks and roles AI is likely to augment or automate over the next three-five years.

To form a view of AI’s potential impact on office demand, we need to look beyond broad claims about AI and jobs.

AI is helping reshape the skills mix required for work

Core skills required by workers are evolving, and as AI becomes more pervasive, human-centric, technological and adaptive capabilities are expected to become more important. By contrast, the capacity of generative AI to substitute humans in executing specific skills is most profound with programming, multi-lingualism, reading, writing and mathematics. Jobs with a larger reliance on skills exposed to AI substitution are at a higher risk of replacement. Jobs requiring core and emerging skills are less susceptible to redundancy.

33%: The number of tasks undertaken solely by humans by 2030, down 12 percentage points from 2025.
34%: The proportion of work tasks solely completed by technology in 2030, up 12 percentage points from 2025.

AI will increasingly automate or augment human work tasks

A World Economic Forum (WEF) survey projects that the proportion of work tasks solely completed by technology will increase from 22% in 2025 to 34% in 2030. Conversely, tasks undertaken solely by humans are projected to decline to 33% in 2030, down from 47% in 2025.

Of the industries that predominantly occupy office space, Telecommunications, Insurance and Pensions Management, and Financial Services and Capital Markets are expecting that more than 95% of the decline in human tasks will occur due to automation.

For more, download the full article.