AI startups are leasing luxury apartments in San Francisco for staff and offering large rent stipends to attract talent 

said Roy Li, CEO of AI startup Cluely, which makes software for job interviews and business calls. New York Times He has rented eight apartments to employees in a recently built luxury complex located just a minute’s walk from the office. Rents in the 16-story building range from $3,000 to $12,000 per month.

“Going into the office should feel like walking into your living room, so we really want people to be close to us,” Lee said. The times Thursday.

Flo Crivello, CEO of Lindy, another AI startup, said he offers his roughly 40 employees a rent stipend of $1,000 a month if they live within a 10-minute walk of the company’s office.

“People feel happier and healthier when they live close to work,” he said. The times. “This makes them last longer, perform better, and work longer hours.”

The AI ​​boom has attracted a torrent of money and talent to San Francisco, inflating rents in the process. The Bay Area has attracted 70% of the nation’s AI venture capital funding since 2019, according to data from Pitchbook.

Across the United States and Canada, the number of tech workers with AI skills jumped more than 50% to 517,000 from mid-2024 to mid-2025, according to a CBRE report released in September. The report said that the San Francisco Bay Area, New York metro and Seattle are among the largest US markets for talent specializing in artificial intelligence, representing 35% of the national total.

At the same time, fully remote work arrangements for open positions have declined, and more employers are adopting hybrid arrangements that require tech talent to spend three or more days in the office. In San Francisco alone, one in every 4 square feet of office space has been leased by an AI company over the past two and a half years, according to CBRE.

Tightness was also observed in the office market in the residential sector. Over the past year, apartment prices in San Francisco have risen 6%, on average, more than double the 2.5% increase seen in New York City and the highest rate in the country, according to data cited by real estate tracker CoStar. The times. And in hot spots like Mission Bay, near OpenAI’s headquarters, rents have risen 13% recently.

The average rent for an apartment in San Francisco is now $3,315 a month, just below New York City’s average rent, the highest in the country, at $3,360.

A September report from real estate technology firm Zumper said San Francisco’s housing market bucked the national trend of flat or falling prices and instead saw the strongest annual growth nationwide for two-bedroom rentals, which rose 17.1%. The report said that the rent for a one-bedroom apartment rose by 10.7%, the third highest increase in the country.

The report cites a “perfect storm” of tech sector hiring and stricter return-to-office mandates driving more renters to the city as well as supply chain constraints. The city’s vacancy rate has fallen to pre-pandemic levels, and new housing construction is at its weakest pace in a decade, the report added.

Will Goodman, director of Strada investment Group, which developed the luxury complex in which Kalili leased its eight apartments, said: The times Half of the complex’s 501 units were rented within two months of its opening in May.

“Honestly, I’ve never seen anything like it before,” he said.