The growth of AI has significant implications for the commercial real estate industry, given the need for foundries, office space, and data centers. In the U.S., the data center industry has expanded alongside AI, with a shortage of chips or graphic processing units posing a challenge. Increased chip production could offer opportunities for industrial real estate, with foreign investors already initiating a bidding war for part of Nvidia’s Santa Clara campus. OpenAI has also contributed to leasing activity in San Francisco's office market, having signed a lease for 486K SF in Mission Bay at the end of 2023.
Key takeaways:
- OpenAI CEO Sam Altman is seeking up to $7T from foreign governments and investors to build infrastructure for the semiconductor and artificial intelligence industries.
- The infrastructure development could significantly impact the commercial real estate industry due to the need for foundries, office space, and data centers.
- Altman is in talks with the United Arab Emirates government to raise funds to increase chip production, as AI requires extensive data storage and hardware.
- Increased chip production could create opportunities for industrial real estate, with foreign investors already initiating a bidding war for part of Nvidia’s Santa Clara campus.