Trump’s National Guard Threat Overshadows San Francisco’s AI Boom

President Donald Trump is escalating calls for the deployment of the National Guard to San Francisco. This comes at a crucial moment, as the city experiences a post-pandemic revitalization largely driven by advancements and investment in artificial intelligence.

Contrary to perceptions fueled by national headlines, San Francisco is showing signs of significant recovery. Crime statistics reveal a 30% decrease compared to 2024, with homicide rates reaching a 70-year low and car break-ins hitting a 22-year low. Simultaneously, event bookings and tourism are on the upswing, residential real estate is becoming increasingly competitive, and the commercial office market demonstrates renewed activity.

A primary catalyst for this resurgence is the burgeoning AI sector. The city is rapidly establishing itself as a global hub for AI innovation, attracting significant venture capital and talent.

New data from CBRE projects that venture capital funding in 2025 will surpass the record $276 billion mark set in 2021. A substantial portion of this investment is concentrated in San Francisco and Silicon Valley. Data indicates that approximately 80% of AI venture funding through the third quarter, totaling $115 billion, was directed towards the Bay Area. This influx of capital is fueling innovation, creating high-paying jobs, and driving demand for real estate across various sectors.

By the end of September, the San Francisco Bay Area had already exceeded its previous annual investment peak by 35%, according to CBRE’s VC Funding analysis. This underscores the region’s dominance in attracting investment in emerging technologies.

“San Franciscans are feeling positive about the direction of our city once again,” Mayor Daniel Lurie stated last week. “And we are going to continue working every single day to build on this progress and keep our city safe 365 days a year.”

Lurie’s statement, released by Governor Gavin Newsom’s office, aimed to highlight the effectiveness of local law enforcement efforts. This messaging came ahead of Salesforce’s annual Dreamforce conference, a major event for the city’s economy. The debate flared after Salesforce CEO Marc Benioff expressed support for Trump’s proposal to involve federal troops in San Francisco. Benioff’s stance received public backing from Elon Musk and David Sacks, prominent figures in the tech industry with ties to the Trump Administration.

However, following mounting criticism, Benioff walked back his initial statement late last week, stating on X that, “Having listened closely to my fellow San Franciscans and our local officials, and after the largest and safest Dreamforce in our history, I do not believe the National Guard is needed to address safety in San Francisco.”

The Trump administration’s previous deployments of the National Guard to cities like Chicago and Portland sparked controversy, including protests and lawsuits. Despite the local pushback, this weekend President Trump reiterated his plans to send troops to San Francisco, stating that, “the difference is I think they want us in San Francisco.”

The White House has not commented on the President’s plans.

Mayor Lurie has emphasized the safety of recent events, including Dreamforce. While refraining from directly addressing Trump’s National Guard proposal, Lurie has adopted a less confrontational approach toward the President since assuming office in January.

“San Francisco is on the rise,” Lurie wrote on X recently.

The data supports his perspective. Recent trends suggest that San Francisco is turning a corner, benefiting from a confluence of factors including a revitalized tech sector, increased tourism, and a recovering real estate market.

Tourism spending is projected to increase modestly this year to $9.35 billion, up from $9.26 billion, according to the San Francisco Travel Association. Large-scale events, from conferences and sporting events like the NBA All-Star weekend to music festivals such as Outside Lands, are boosting the city’s economy.

The commercial real estate market is also showing signs of recovery as companies gradually ease Covid-era work-from-home policies. CBRE reports that tech companies accounted for 53% of leasing activity by square footage in 2025, the highest percentage since 2019. Apartment rental prices are also surging, with multifamily rentals increasing by 6% in August, significantly outpacing the 3.75% increase in Chicago, which had the second-highest increase.

Ted Egan, chief economist for San Francisco, stated that “housing is probably as cheap as it’s going to get for a while.” This suggests that the window of opportunity for potential residents and investors may be closing rapidly.

However, challenges remain. The city has experienced the loss of key tenants in its downtown shopping district, including its flagship Nordstrom store which was part of San Francisco Centre. The mall is now largely vacant, highlighting the need for innovative strategies to revitalize the retail sector.

Office vacancies remain elevated at 33.6% in the third quarter, according to Cushman and Wakefield. Homelessness and open drug use persist as long-standing issues that are heavily concentrated in specific areas of the city. Addressing these problems will be crucial to ensuring the long-term sustainability of the city’s recovery.

Despite these challenges, Egan conveys optimism, noting a marked improvement in the city’s overall health and vibrancy.

“It seems cleaner and safer now than it’s ever been in any of the time that I’ve been here,” said Egan, who’s worked in San Francisco for more than 20 years. “I still think it’s a great place to move to because it’s got tons of economic opportunity. It’s got tons of long-term economic strengths for people starting out in their career.”