AI Companies Absorbing Office Space At Record Pace: Report

Artificial intelligence (AI) firms are absorbing office space in primary markets such as San Francisco and New York City at a record pace, and the sector’s voracious demand for office space to build out development teams and products has begun spilling into a select subset of submarkets as well.

National AI office demand was up 85 percent in the 12 months through May and spiked 179 percent in major AI hubs, a new AI report published on July 9 by AI-powered commercial real estate platform VTS states.

AI companies represented office demand of 16.8 million square feet across 17 markets during the period, VTS senior research manager Rene Moreira noted.

However, three metro areas represented nearly two-thirds of total office demand from AI companies, with San Francisco—the global epicenter for AI talent and development—accounting for 25 percent.

Office properties in San Francisco and Silicon Valley, California, and New York accounted for 63 percent of all current AI leasing, Moreira said.

“San Francisco alone sits at 5 million square feet, nearly a third of the national total,” he said.

Unprecedented office demand from AI companies in San Francisco is powering the city’s office market to a modest recovery after the COVID-19 pandemic. In the second quarter of 2019, San Francisco’s office market hit a vacancy rate of 4.7 percent. Vacancy soared following work-from-home initiatives, however, reaching 30 percent in 2023 and topping out at 35.7 percent as recently as the second quarter of 2025, the City of San Francisco reported.

San Francisco’s office vacancy stood at 32.6 percent at the end of the first quarter of this year.

“San Francisco’s 81 active AI requirements average 62,000 square feet, 2.3 times the average tech requirement across all markets,” Moreira said.

The 45 active AI office lease searches in New York average 61,00 square feet each, while the 58 active searches in Silicon Valley average about 48,000 square feet, or 2.8 million square feet of office space.

Each submarket caters to different AI users, VTS noted. San Francisco is the headquarters of AI pioneers Anthropic (Claude) and OpenAI (ChatGPT), while Silicon Valley’s AI firms tend to be chip designers, hardware manufacturers, and infrastructure providers. New York’s AI companies are skewed toward enterprise-level AI firms, a nod to the city’s massive financial, legal, and media industries. AI firms in Washington, such as Anduril, Palantir, and Shield AI, serve the defense industry.

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Pollution from Musk’s unpermitted xAI power project hits hardest in Black communities

Elon Musk’s artificial intelligence company xAI has installed 59 natural gas turbines for its Colossus 2 data center project in Tennessee without securing federal clean air permits, according to communications between regulators and xAI representatives.

Potential emissions from the turbines are far beyond the threshold that would require a federal permit, and would be released near predominantly Black communities already estimated to be suffering disproportionately high rates of lung disease, according to a Reuters analysis based on government data and information in the correspondence with regulators.

The findings, which have not been previously reported, reflect how exploding electricity demand from AI data centers is driving companies to build off-grid power plants at a pace outstripping environmental oversight, with potentially big risks to public health.

The number of unpermitted turbines identified by Reuters is about double what xAI has publicly acknowledged. The company previously said it was running 27 unpermitted turbines for Colossus 2 as of January and has argued the permits are not required. At least 57 of the 59 turbines are located in Mississippi, just over the state line from Tennessee where the data center is located.

The xAI turbines are among scores of off-grid power plants for data centers proposed or under construction around the country. Local authorities often fast-track approvals in just weeks or months, without the years of environmental studies and public hearings typically required for such power generation projects that connect to the grid, Reuters has reported.

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REPORT: Russia Intercepts Western AI Drones Smuggled for Deep Strikes on Military Bases

Russian security forces have seized a cache of Western-manufactured, artificial intelligence-guided drones that were allegedly smuggled into the country for planned attacks on remote military aviation bases in the Ural Mountains and the Far East.

The Federal Security Service (FSB) announced Monday that operatives intercepted the hardware before it could reach the Shagol air base in the Chelyabinsk region and the Ukrainka air base in the Amur region. Several individuals involved in the transit operation have been detained.

Covert Smuggling Operation

According to the FSB, the drones first entered Russian territory using balloons and larger fixed-wing unmanned aircraft, landing in the Bryansk border region. Smugglers then concealed the devices inside specially modified trailers equipped with false bottoms, transporting them across the country disguised as shipments of household appliances, reported Sputnik.

AI-Guided Strike Capabilities

Russian authorities stated that the confiscated drones originated from the United States, Britain, Canada, and Sweden. Each unit was armed with more than one kilogram of explosives and featured advanced AI navigation systems engineered to evade Russian electronic warfare and signal-jamming networks.

Parallel to Ukrainian Tactics

The intercepted plot bears similarities to a 2025 Ukrainian operation known as “Spider’s Web,” in which trucks with retractable wooden roofs were used to transport and launch drones. That campaign reportedly damaged around 20 aircraft and successfully struck the Ukrainka base.

In recent months, Kyiv has intensified long-range strikes on Russian defense enterprises and energy infrastructure located deep inside the country. These attacks have taken major oil refineries offline, contributing to widespread fuel shortages.

Kremlin Accuses West of EscalationI

n response to the expanding reach of Ukrainian deep-strike operations, Moscow has sharpened its accusations against Western nations, claiming they are directly enabling the attacks.

Last week, Kremlin spokesman Dmitry Peskov declared that Western support for Ukraine had transformed Russia’s “special military operation” into a full-scale war.

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The Secret Race To Produce the First AI-Generated Blockbuster Movie

Movie-making is an artifice, so will creators embrace AI?

While many actors and filmmakers go out of their way to bash AI image-generating technology as hard as they can, there’s a secret undercurrent in which Hollywood is all-in on Artificial Intelligence, and the race is on to generate the first AI blockbuster.

Some sectors of the film industry are slow to accept change, with some still refusing to change 35mm film for digital.

The fact is: when creators shun utilizing new tech developments, they are just marrying themselves to an earlier-age’s technological solutions – after all, there’s nothing natural about film-making.

The New York Post reported:

“AI has officially been met with extreme skepticism by more entrenched filmmakers. However — as is always the way in two-faced, back-biting, cutthroat Hollywood — that also means behind the scenes, every studio, filmmaker, and screenwriter worth their salt are desperately trying to harness its power to push the boundaries and create something new to wow audiences with.

‘The space race was about being first, but it was also about inspiring the world that we should keep competing and keep investing [in the technology]. Bigger than being first, which is fleeting, is inspiring the world’, Bryn Mooser, who has two Academy Award nominations for documentary shorts, told The Post.”

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AI war machines hit the ground running: Marine Corps quietly orders autonomous ground vehicle fleet that can drive itself into combat

The United States Marine Corps has quietly placed its first production order for a fleet of fully autonomous ground vehicles that can navigate battlefields, plot their own routes, and execute resupply missions without a human behind the wheel. This is no longer science fiction. Under a $19.7 million production award issued through the Pentagon’s Accelerate the Procurement and Fielding of Innovative Technologies program, Seattle-based Overland AI will deliver more than a dozen autonomous ground vehicles to the Marine Corps by early 2027, marking the first time a ground autonomy company has served as the prime contractor for a production contract of its kind. While military officials frame this as a logistical upgrade, the deeper implications point toward a future where machines not only drive themselves but eventually decide when and how to kill, and in the most efficient manner possible.

Key points:

  • The Marine Corps has awarded Overland AI a $19.7 million contract for autonomous ground vehicles.
  • Vehicles will operate without continuous human control using onboard navigation software.
  • First operational role focuses on resupply missions for the Marine Air Defense Integrated System.
  • Overland AI CEO Byron Boots confirmed extremely high demand from U.S. operational units.
  • Autonomous platforms could expand into intelligence, surveillance, and breaching missions.
  • Contract delivered through Pentagon APFIT program designed to accelerate battlefield technology.
  • Vehicles use open architecture allowing integration with Joint Light Tactical Vehicle platforms.

When machines decide where to go

What separates Overland AI’s platform from previous unmanned ground vehicles is the degree of independence these machines possess. Traditional robotic vehicles require a remote operator to steer, accelerate, and brake, essentially a video game controller attached to a military vehicle. Overland AI’s system operates differently. Operators assign a destination point, and the onboard software handles everything else. The vehicle plans its own route, interprets terrain conditions, controls acceleration and braking, and navigates obstacles without continuous human input. Personnel can still assume remote control when necessary, but the default mode is machine autonomy.

This represents a fundamental shift in military robotics. The Marine Corps is no longer testing remote-controlled equipment. It is buying vehicles that make driving decisions on their own. Overland AI Chief Executive Officer Byron Boots stated that demand for autonomous ground systems has increased sharply as militaries evaluate lessons from recent conflicts. “Ground autonomy matters now more than ever,” Boots said. “We’re registering extremely high demand from U.S. operational units who want to incorporate this technology into their concepts of operation.”

The company expects to deliver the vehicles in roughly nine months, though officials did not disclose the exact number of platforms or technical specifications including payload capacity and vehicle type. This opacity is deliberate. The military does not want adversaries knowing how many autonomous systems are entering the battlefield or what they are capable of carrying.

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While The Political Circus Distracts Us, Flock Builds The Digital Police State

“You had to live – did live, from habit that became instinct – in the assumption that every sound you made was overheard, and, except in darkness, every movement scrutinized.”

– George Orwell, 1984

While Americans remain transfixed by the political circus – cheering for their preferred party, jeering at the opposition, obsessing over every manufactured outrage and waiting for the next spectacle – the Surveillance State continues its steady march forward.

The government is watching.

It watches where you go, whom you meet, where you worship, what medical offices you visit, what political rallies you attend, what protests you join, what books you read, what websites you visit and what causes you support.

It watches through your phone, your car, your doorbell, your appliances, your purchases, your social media accounts and the cameras positioned along the roads you travel every day.

This is how freedom dies in the digital police state: not always through dramatic declarations of martial law or soldiers stationed on every street corner, but through the gradual construction of a technological dragnet—an electronic concentration camp—so pervasive that privacy becomes impossible and anonymity becomes suspicious.

Enter Flock Safety, a private surveillance technology company whose automated license plate readers have spread throughout thousands of American communities.

These cameras, which do much more than photograph license plates, represent the next evolution of the government’s public-private surveillance partnership.

They document the time and location of every passing vehicle and record identifying characteristics such as its make, model, color, damage, roof racks, bumper stickers and other distinctive features. That information can then be placed in a searchable database and used to retrace a vehicle’s movements over time.

Yet the real power—and the real danger—of Flock does not come from the cameras alone.

It comes from artificial intelligence.

A camera can photograph a car. Flock’s AI-powered platform can identify and categorize a vehicle, compare an observation with stored records, generate alerts, identify connections and help police reconstruct where that vehicle has been.

AI is what transforms a photograph into the building blocks for a suspect society.

With AI, every driver becomes a data point. Every data point becomes a pattern. And every pattern becomes a suspicion.

This is how ordinary movements become potentially suspect and subject to government scrutiny. It allows law enforcement agencies to search not only for a complete license plate number but also for partial plates and physical descriptions such as vehicle color, make, model, damage, roof racks, bumper stickers and other identifying characteristics.

A police officer might ask the system to locate every red pickup truck with a ladder rack seen near a protest, every vehicle that repeatedly visited a particular address, or every car observed traveling between two locations.

The artificial intelligence does the sorting. The database supplies the history.

The government receives a list of potential suspects.

This is no longer surveillance conducted by individual officers following particular leads. It is surveillance conducted at machine speed, across entire populations, with algorithms deciding whose movements merit further scrutiny.

Consider the scale of what is taking place.

License plate cameras now log approximately 20 billion vehicle scans every month.

Twenty billion.

That is not targeted policing. That is mass collection.

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Quote of the day by Sun Microsystems CEO Scott McNealy: ‘You have zero privacy anyway. Get over it’ — an early declaration foreshadowing the modern era

Sun Microsystems was a huge force in the technology landscape, with its co-founder and CEO Scott McNealy an outspoken and brash maverick in the early Silicon Valley ecosystem. The company had just launched a new system, and McNealy was quick to push back on any critique centering around the implications for user data.

During an informal Q&A session with reporters, McNealy slapped down concerns that the newly launched Jini platform could pose a risk to user privacy.

The system, as it was engineered, was a revelation – but ultimately failed to catch on due to some pretty significant hardware hurdles. Designed to allow devices to communicate with and share resources, the Jini network architecture allowed unadulterated communication without configuration, driver installations, or human intervention.

It was an early and ambitious effort to establish a vision for smart homes and offices. The trouble was that it required devices to continuously upload data and lease space on networks, with the system creating a massive digital footprint.

Erosion of privacy

McNealy’s comments, unsurprisingly, drew immediate and sharp criticism from privacy advocates and campaigners. Lori Fena, then chairman of the board of the Electronic Frontier Foundation, said the comments were “completely irresponsible”, for example.

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Humanoid Robots Perform Successful Gallbladder Surgery in Major Medical Breakthrough

Humanoid robots have successfully performed gallbladder removal surgeries in live pigs for the first time, marking a significant milestone in the development of robotic surgery and paving the way for future human trials.

The procedures were carried out by researchers at the University of California, San Diego, with the findings published Wednesday in the journal Nature.

The first operation involved a humanoid robot working alongside a surgeon. In the second, two humanoid robots completed the procedure together without direct human assistance.

Researchers say the successful surgeries represent an important proof of concept as the technology moves toward clinical testing in humans.

“As a proof of concept, it absolutely worked,” Dr. Ryan Broderick, interim director of the Center for the Future of Surgery at UC San Diego, told ABC News.

Unlike conventional robotic surgical platforms, the humanoid robots feature a head and two arms.

This allows them to work in operating rooms without the bulky equipment typically required for robot-assisted procedures.

“The space constraints didn’t exist like in traditional robotic surgery,” Broderick said.

“It was a human-type bedside assistant, so it just fit into the space that we’re traditionally used to being in for laparoscopic surgery.”

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Without Subsidies, Is AI Unaffordable?

Let’s pull all this into an undeniable conclusion: AI is based on massively subsidizing users’ costs.

What’s already abundantly clear but verboten to say as it would pop the bubble of AI valuations and triumphalism is that AI is unaffordable once the direct and indirect subsidies are withdrawn. Nothing that consumes this much electricity and requires such an immense scale of costly processing and memory capacity can be low-cost, never mind free.

The major AI platforms and vendors are subsidizing corporate and individual users in the hopes that they can achieve AI sector dominance –and the pricing power that comes with it–via the network effect, the dominance generated by having the majority of users bound by habit or dependence to your platform or tools.

This battle for network effect dominance is playing out in full view:

AI Giants Are Handing Out Tons of Free Computing Power to Grab Startup Share: (wsj.com) Pitched battle for business users comes as AI companies seek lasting streams of revenue.

Hans Ibarra, a founder building an AI-voice startup, has found himself on the receiving end of a big opportunity: Top artificial-intelligence companies such as OpenAI, Anthropic and others desperate to win his business are ramping up discounts.

Across Silicon Valley, startup founders like Ibarra are enjoying a wave of computing credits and fielding competing offers from AI-model makers racing to land new enterprise customers. Cursor, the AI-coding company bought by Elon Musk’s SpaceX, offered a 75% discount through July 5.

“If I’m choosing between a really cheap Chinese model that I actually have to pay for, and a very expensive Anthropic model that I don’t have to pay for, I’m going to pick the Anthropic model,” Acker said. “I’m always going to pick the one for which I have free credits.”

Meanwhile, back in the real world of costs, AI Costs More Than The People It Replaced (forbes.com)(via Tom D.)

It turns out that experienced human workers doing the work right in the first place is cheaper than having AI run a probability distribution process that needs vetting and corrections. And remember, AI isn’t actually “intelligent,” it’s just a probability distribution using natural language.

As management guru Peter Drucker observed, enterprises don’t have profits, they have costs. Purveyors of AI platforms and tools have costs, and so do their customers. Those costs are currently being funded by investors, who are in effect subsidizing the AI companies’ “free” giveaways of horrendously costly “tokens” in a manic, desperate attempt to grab the brass ring of network effect dominance before their cash runs out.

This raises a question: Is this any way to run a railroad? In other words, is this actually a viable business model, burning billions of dollars in cash to lock in network effect dominance in a field that is rapidly obsoleting every iteration of an innately limited mode of computation? Is claiming that a probability distribution is “intelligent” in the same way humans are intelligent a viable business model when there is ample evidence this simply isn’t true?

AI and human intelligence are drastically different–here’s how (scientificamerican.com)

What happens when enterprises have to pay the unsubsidized costs of AI is they immediately curtail their AI spending because the customer-facing / financial benefits of AI are at best elusive and often negative. Peter Drucker was onto something that is currently being lost in the PR-propaganda push of those trying to cash in on the AI euphoria: enterprises don’t have profits, they have costs, and the real-world costs of AI are extraordinarily high while the payoffs are ambiguous.

There are many other hidden subsidies within the AI machinery. There are corporate tax write-off subsidies, energy subsidies, tax credit subsidies for building data centers, and so on. If these were stripped out, what would the real unsubsidized costs of AI be? No one knows, but they would be higher than what’s presented as the cost now.

Then there’s the if it’s legal, it’s moral, and what’s legal is for sale subsidy: AI is built on the systemic theft of copyrighted content. Last month alone, AI scrapers gorged on 246,000 pages from my Of Two Minds server, and hundreds of thousands of pages of my copyrighted works on my mirror site and other sites posting my work.

This is legal, but is it moral? Nobody asks such questions because the important thing is to avoid saddling AI users with the real costs. So if all those content creators get nothing–in effect, subsidizing both AI companies and the users of their AI platforms and tools–well, so what, because if it’s legal, it’s moral, and what’s legal is for sale.

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The Economics Of The Surveillance State

How did KGB agents commit suicide?  Two shots to the back of the head.  (all photo content as-found)

Remember Lavrentiy Beria’s cheerful advice:  “Show me the man, and I will find the crime”?  Back in the Soviet Union they had so many laws on the books that everybody broke at least one before lunch, I mean, when lunch was available.  And if they didn’t, they could make up something.  Beria just needed enough spies and informants to spot the right violation.

Beria would have loved modern America.  We’ve upgraded his whole operation with better cameras, faster computers, and added actual profit margins.

Let’s start with Flock™ cameras.

Flock Safety© cameras now line roads from coast to coast.  More than 100,000 of the little snitches sit on poles in ditches scanning license plates 24/7 and however many metric hours in a metric day and metric days in a metric week.  The cameras rolled out one quiet law enforcement contract at a time until the whole country is now blanketed.

Not everyone who comes into your life is your friend.  Some are just surveillance cameras. (btw, she was innocent, but the police didn’t apologize)

Maps of the cameras exist online, but those rely on humans, and it shows only three of the eight within five miles of my house in Modern Mayberry.  I could plot an avoidance route if I had nothing better to do than play spy versus spy on my commute, or build a detector like Benn Jordan did.

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