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San Francisco's AI boom can't stop real estate slide, as office vacancies reach new record

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San Francisco's AI boom can't stop real estate slide, as office vacancies reach new record


Artificial intelligence has been a big boon for San Francisco real estate. But not enough of one to make up for the broader struggle across the market.

The vacancy rate for San Francisco office space reached a fresh record of 34.5% in the second quarter, according to a report Monday from commercial real estate firm Cushman & Wakefield. That’s up from 33.9% in the first quarter, 28.1% in the same period a year ago and 5% before the pandemic.

Meanwhile, the average asking rent dropped to $68.27 per square foot in the quarter, the lowest since late 2015, down from $72.90 a year earlier and a peak of $84.70 in 2020.

San Francisco is reeling from the twin challenges of bringing people back to the office after the Covid pandemic and a slowdown in the tech market that’s led to mass job cuts across the industry. Tech companies have laid off more than 530,000 employees since the start of 2022, according to the website Layoffs.fyi, with major downsizing at Alphabet, Meta, Amazon, Tesla, Microsoft and Salesforce.

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Softening the blow of late has been the soaring popularity of generative AI and the decision by fast-growing startups to open large offices in San Francisco.

OpenAI, the market leader with a private valuation that’s topped $80 billion, announced in October that it was leasing about 500,000 square feet of space in the Mission Bay neighborhood, the biggest office lease in the city since 2018. Robert Sammons, senior research director at Cushman & Wakefield, said OpenAI is continuing to look for more space in the city.

Also last year, OpenAI rival Anthropic subleased 230,000 square feet at Slack’s headquarters. And in May of this year, Scale AI signed a lease for a reported 170,000 to 180,000 square feet of space in Airbnb’s office building.

“San Francisco is certainly the center of AI, but AI is not going to save the San Francisco commercial real estate market,” Sammons said. “It will help.”

While richly capitalized AI startups are signing large leases for new space, the bigger trend is that tech companies, law offices and consulting firms are looking to reduce their footprint when existing leases come up, Sammons said, reflecting the widespread move to hybrid work.

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In many cases, companies are looking to relocate to higher quality space in more desirable parts of the city, because prices have come down and employers need to be near restaurants and shops to get staffers to come back, Sammons added.

“The best quality trophy space continues to perform well, because tenants want to be in the best locations with the best amenities around them,” Sammons said.

Some of the city’s top employers, including Salesforce, Uber, Visa and Wells Fargo, have brought employees back to offices for part of the week. That’s helped in the financial district, where the vacancy rate is still 34.2% on the north side and 32.7% on the south side at the end of the quarter. In SoMa, which historically was a popular area for venture-backed startups, the vacancy rate is almost 50%.

SoMa is further away from mass transit options and has also been hurt by large retail departures. Vacant office space across San Francisco for the quarter totaled 29.6 million square feet, Cushman & Wakefield said.

The firm said in its report that there are positive signs in the market, with absorption poised to improve in the second half and office job numbers stabilizing following a steep drop-off. But Sammons said it looks like there’s more room for rents to fall and for vacancies to rise. Uncertainty surrounding the upcoming presidential election may be a factor delaying new leases, he said.

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“Sometimes tenants postpone making decisions when there are major elections,” he said.

WATCH: Commercial real estate vacancies in San Francisco are at an all-time high



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Latest California-based gig work app lets people book content creators, editors

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Latest California-based gig work app lets people book content creators, editors


It’s 10 a.m. sharp, and Abby Kurtz gets her first assignment of the day. She’s received a time, a location in San Francisco and a target.

Her weapon of choice: an iPhone.

“Being a social agent is really the coolest thing ever,” she said. 

Kurtz is a content creator working through an app called Social Agent, part of an expanding gig economy where more and more workers are trading stability for flexibility. Work that once required connections, planning, and a big budget can now be booked with a tap —extending the on-demand model from rides and meals to storytelling itself.

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 Just make a request, and someone like Kurtz can arrive within 30 minutes, camera-ready.

“What I look for when I’m shooting events is very crisp and clean content,” she said. 

Her mission this time took her to Sutro Nursery, a nonprofit dedicated to growing native plants and that is hoping to grow its volunteer base, too. Board member Maryann Rainey said booking a Social Agent is a lot cheaper than hiring someone to do their social media full-time. 

“I know I can’t do it myself, and I was certainly hoping that these young people would know how to do a good film,” Rainey said.

A typical job runs about $200, with same-day delivery. Agents earn around $50 an hour, plus tips. And if clients already have footage, they can upload it and have it turned into a finished piece. 

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The service is currently available in New York, Los Angeles, and Miami, with a slower rollout now underway in other cities.

 Lisa Jammal, the company’s CEO, said the idea is simple: Let someone else do the shooting.

“We all are missing those beautiful moments because we’re always behind the phone,” she said. 

As for Kurtz, after the shoot, she headed straight to a nearby coffee shop, where the clock started ticking. She had just over an hour to shape her raw material into a polished final cut.

“I think I’m going to give this reel a really peaceful, calming feel, but also informative and inviting,” she said. 

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SF scientists build robotic storm samplers to track pollutants before they reach the Bay

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SF scientists build robotic storm samplers to track pollutants before they reach the Bay


SAN FRANCISCO (KGO) — Environmental Scientist Kayli Paterson from the San Francisco Estuary Institute is hitting the road with colleague David Peterson and a trunk full of water sampling robots.

“Yeah, I think the max we’ve ever done was five. But the sites are very close together. Oh, there it is. Hopefully it samples well,” says Paterson as she turns the mobile sampling lab onto a private oak-lined road.

They’re closing in on a watershed creek flowing through the hillsides near the San Andreas Lake reservoir, west of Highway 280 in Millbrae, part of the larger watershed that eventually drains into San Francisco Bay.

“So, we’ve got our sampler. Look at the battery. Hook that up, red and black. This is a 12-volt lithium battery, and it powers our sampler for probably about six to seven days,” she explains, showing off a self-contained unit miniaturized into a portable case.

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MORE: Futuristic Fight Club: VR-controlled boxing humanoid robots battle in San Francisco

The black cases are their latest innovation in stormwater science. Robotic samplers anchor in key sections of the watershed to monitor not only flow, but also the chemicals and pollutants washing downstream toward the Bay.

“And this is a front-line pollution sampler. It’s getting the stormwater before it enters the Bay. And so, we want to know what’s coming into the Bay and getting these samplers out there in more locations will give us a better idea of where we might have issues, where a hotspot is, or maybe a previously unknown contaminant,” says Paterson.

“It’s important to get out that fast,” her colleague David Peterson adds. “You know, in these storms as they’re happening, because the water is picking up pollutants in real time, and we need to be there to capture them.”

When we first met Peterson several years ago, he and another Estuary Institute team were sampling water along the Bay shoreline by hand, a technique that’s still valuable. But to cover more ground, Kayli and a group of collaborators began developing the robotic samplers over recent storm seasons.

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Kayli and David start by chaining the unit itself to a tree near the creek bank. The system employs remote-controlled pumps that draw samples from the creek and store them in onboard containers. The software controlling the volume and frequency can be operated from a phone app.

MORE: New study of San Francisco Bay fish confirms concentrations of PFAS aka ‘forever chemicals’

One of the key targets in this study is a group of so-called “forever chemicals” known as PFAS, synthetic compounds that persist in the environment and have been detected in widespread areas of the Bay.

“And we capture samples and send them off to analytics labs across the country. Typically, universities or private labs will process these for us,” Peterson explains.

For these two stormwater detectives, it’s a mission that requires a combination of speed and patience**, chasing flowing water** through creeks and storm drains, sampling as they go.

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“So, we’re looking for areas – the point of this is to do source control. Ultimately, we want to be able to trace this back to a possible source,” says Kayli Paterson.

And potentially prevent a source of toxic pollution from reaching San Francisco Bay and our Bay Area ecosystem.

More than a dozen of the robots were given names in a special contest, including the Big Sipper and the Tubeinator.

Copyright © 2026 KGO-TV. All Rights Reserved.



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Floats for San Francisco Chinese New Year Parade get finishing touches

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Floats for San Francisco Chinese New Year Parade get finishing touches


SAN FRANCISCO (KGO) — ABC7 Eyewitness News got a sneak peak as crews put the finishing touches on the floats you’ll see at Saturday’s San Francisco Chinese New Year Festival and Parade.

Since it’s the year of the fire horse, you’ll see a lot of horses and fire symbolism on the floats, housed at Pier 19.

“So Year of the Horse, it’s energy, it’s passion, it’s momentum so a lot of things that we’re really hoping to embody in the new year,” said Stephanie Mufson, owner of San Francisco-based The Parade Guys, which designs and constructs the floats.

She said they’ve been building them for about three months, with the designs starting in November.

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MORE: Bay Area artist brings Year of the Horse statue to life for Golden State Warriors

“We’re in the home stretch,” she said. “We’ve got a couple of days left and we’ve got a nice little team that’s cranking out all the finishing work that needs to go into it.”

Derrick Shavers was sanding some wood that will be painted and become cherry blossom trees on a float.

“It’s exciting,” Shavers said. “I look forward to coming every year and just creating and making things shine and sparkle.”

Bon was painting mountains for a float, making sure everything is perfect in time for the parade.

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MORE: Meet the 2026 San Francisco Chinese New Year Parade mascot, Maverick

“It’s one of the few parades that actually happens at night still,” Bon said. “So we got to make sure all the lighting is in check, and people are safe on the float. It’s all in the details, just for it to walk by you for 10 seconds.”

Ten seconds that bring so much joy to those watching the parade.

Here’s how you can watch the parade on ABC7 Eyewitness News on Saturday, March 7.

Coverage starts at 5 p.m. wherever you stream ABC7.

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SF Chinese New Year Parade 2026: How to watch ABC7 Eyewitness News live coverage


If you’re on the ABC7 News app, click here to watch live

Copyright © 2026 KGO-TV. All Rights Reserved.



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