>>> TONIGHT, THE DRAMATIC TURN IN THE CRIMINAL CASE AGAINST HUNTER BIDEN AS HIS PLEA DEAL IS DERAILED. THE PRESIDENT'S SON ENTERING A FEDERAL COURT IN DELAWARE WHERE HE WAS EXPECTED TO PLEAD GUILTY TO TAX CRIMES, BUT THE JUDGE REFUSING TO ACCEPT THE TERMS OF HIS DEAL WITH PROSECUTORS. HIS ATTORNEY AT ONE POINT THREATENING TO RIP UP THE AGREEMENT. THE DRAMA COMING AS REPUBLICANS RAMP UP THEIR INVESTIGATIONS INTO HUNTER BIDEN. CAN THE DEAL BE SAVED? >>> ALSO TONIGHT, SCARY MOMENTS FOR MITCH McCONNELL MONTHS AFTER SUFFERING A CONCUSSION. THE SENATOR APPEARING TO FREEZE ON CAMERA DURING A NEWS CONFERENCE THEN LED AWAY RETURNING MOMENTS LATER. WHAT HIS TEAM SAYS HAPPENED. >>> IN NEW YORK, THE CRANE 45 STORIES HIGH COLLAPSING IN FLAMES HITTING ANOTHER BUILDING AND CRASHING TO THE GROUND. THE TERROR AS BYSTANDERS RUN FOR COVER. >>> THE EXTREME HEAT NOW STRETCHING COAST TO COAST. 125 MILLION ON ALERT FROM CALIFORNIA TO MAINE. >>> NEWS TONIGHT ON THAT OHIO OFFICER WHO UNLEASHED A POLICE DOG ON A SURRENDERING MAN. NOW OUT OF A JOB. SINGER S O'CONNOR. ♪ NOTHING COMPARES ♪ >> Announcer: THIS IS "NBC NIGHTLY NEWS" WITH LESTER HOLT. >>> GOOD EVENING, AND WELCOME. TONIGHT, A COURTROOM SURPRISE FOR PRESIDENT BIDEN'S SON, HUNTER, WHO IS WIDELY EXPECTED TO WALK OUT OF A COURT TODAY WITH MOST OF HIS LEGAL TROUBLES BEHIND HIM. INSTEAD, THE YOUNGER BIDEN SAW HIS PLEA ARRANGEMENT WITH THE GOVERNMENT OVER TAX CHARGES CRUMBLE WHEN THE JUDGE CHALLENGED SOME OF THE TERMS OF THE DEAL INCLUDING A CONSTITUTIONAL QUESTION TELLING THE TWO SIDES, SHE CANNOT ACCEPT OR REJECT THE PLEA AGREEMENT. THE UPSHOT, INSTEAD OF PLEADING GUILTY TO FAILING TO PAY HIS TAXES FOR TWO YEARS, AS THE ARRANGEMENT CALLED FOR, HUNTER BIDEN PLED NOT GUILTY TO THE CHARGES. THE TWO SIDES ORDERED TO PROVIDE THE COURT WITH MORE INFORMATION. HUNTER BIDEN HAS BEEN A FREQUENT TARGET OF PRESIDENT BIDEN'S POLITICAL ADVERSARIES WITH MANY CALLING THE HUNTER PLEA AGREEMENT A SWEETHEART DEAL. RYAN NOBLES HAS DETAILS. >> Reporter: HUNTER BIDEN ENTERED A FEDERAL COURTHOUSE TODAY HOPING TO BRING TO AN END HIS LEGAL PROBLEMS. IT DID NOT TURN OUT THAT WAY. TONIGHT, IN A STUNNING MOVE, A FEDERAL JUDGE REFUSING TO SIGN OFF ON HIS CONTROVERSIAL PLEA DEAL. JUDGE MARYELLEN SAYING IT CONTAINED APPOINTEE SAYS IT CONTAINED ATYPICAL CONDITIONS AND SAYING, I'M NOT IN A POSITION TO ACCEPT OR REJECT, SO I'M GOING TO DEFER IT. AT ONE POINT BIDEN'S ATTORNEY DECLARING, QUOTE, WE'LL RIP IT UP WHILE PROSECUTORS REVEALING THEIR INVESTIGATION INTO HUNTER BIDEN IS ONGOING AND THE DEAL WOULD ONLY ABSOLVE HUNTER OF LEGAL ISSUES BETWEEN 2014 AND 2019 AND ONLY ON DRUGS, TAXES, AND FIREARMS CHARGES. HUNTER BIDEN TODAY PLEADING NOT GUILTY TO THE TAX CHARGES. THE DELAY IN THE CASE A FURTHER POLITICAL HEADACHE FOR THE WHITE HOUSE. >> THIS CASE WAS HANDLED INDEPENDENTLY, AS ALL OF YOU KNOW, BY THE JUSTICE DEPARTMENT UNDER THE LEADERSHIP OF A PROSECUTOR APPOINTED BY THE FORMER PRESIDENT, PRESIDENT TRUMP. >> Reporter: THE ORIGINAL PLEA AGREEMENT SPARKING OUTRAGE FROM REPUBLICANS BLASTING IT AS A SWEETHEART DEAL FOR THE PRESIDENT'S SON, WHICH ALLOWED HIM TO AVOID PRISON TIME. THE ATTORNEY GENERAL HAS SAID THAT U.S. ATTORNEY DAVID WEISS HAS FULL AUTHORITY TO BRING WHATEVER CHARGES HE WANTED, BUT TWO IRS INVESTIGATORS TURNED WHISTLE-BLOWERS RECENTLY TOLD CONGRESS THAT WAS NOT TRUE. >> IT APPEARED TO ME, BASED ON WHAT I EXPERIENCED, THAT THE U.S. ATTORNEY IN DELAWARE IN OUR INVESTIGATION WAS CONSTANTLY HAMSTRUNG, LIMITED, AND MARGINALIZED BY DOJ OFFICIALS, AS WELL AS OTHER U.S. ATTORNEYS. >> Reporter: MEANWHILE, HUNTER BIDEN'S FOREIGN BUSINESS DEALINGS AT THE CENTER OF HOUSE REPUBLICANS' GROWING INVESTIGATIONS INTO THE PRESIDENT THAT COULD LEAD TO AN IMPEACHMENT INQUIRY. >> IMPEACHMENT INQUIRY IS ALLOWING CONGRESS TO GET THE INFORMATION. >> Reporter: THE PRESIDENT HAS REPEATEDLY DENIED HE SPOKE TO HIS SON ABOUT HIS BUSINESSES. SO FAR, THE GOP PROVIDING NO EVIDENCE OF WRONGDOING, AND HUNTER BIDEN ALSO AT THE CENTER OF ANOTHER CONTROVERSY. WITH PRESIDENT BIDEN FACING CRITICISM FOR NOT PUBLICLY ACKNOWLEDGING HIS SEVENTH GRANDCHILD, HUNTER'S DAUGHTER. >> I HAVE SIX GRANDCHILDREN, AND I'M CRAZY ABOUT THEM. >> Reporter: HUNTER BIDEN AND THE CHILD'S MOTHER RECENTLY CONCLUDED A LEGAL DISPUTE. THE WHITE HOUSE HAS DECLINED TO DISCUSS THE ISSUE. >> SO, RYAN, LET'S CIRCLE BACK TO THE SURPRISING COURT HEARING TODAY. WHAT HAPPENS NOW IN ALL THIS? >> Reporter: WELL, THE JUDGE HAS GIVEN THE TWO SIDES 30 DAYS TO WORK OUT AN AGREEMENT THAT WOULD SATISFY HER CONCERNS, AND THIS COMES AS THE U.S. ATTORNEY, DAVID WEISS, WHO HAS DISPUTED THE CLAIMS OF THOSE IRS WHISTLE-BLOWERS HAS OFFERED TO TESTIFY IN FRONT OF CONGRESS LATER THIS FALL. LESTER. >> RYAN NOBLES, THANK YOU. >>> WE'LL TURN TO THAT FRIGHTENING MOMENT IN WASHINGTON TODAY. SENATE REPUBLICAN LEADER MITCH McCONNELL ALARMED HIS COLLEAGUES AND MANY WATCHING WHEN HE FROZE DURING A NEWS CONFERENCE. GARRETT HAAKE WITH MORE ON THIS FROM CAPITOL HILL. >> Reporter: A REGULAR SENATE RITUAL INTERRUPTED TODAY BY 19 SECONDS OF SILENCE. QUICKLY TURNING TO CONCERN FOR THE HEALTH OF SENATE MINORITY LEADER MITCH McCONNELL, WHO APPEARED TO FREEZE UP AS HE BEGAN HIS WEEKLY NEWS CONFERENCE. >> WELL, GOOD AFTERNOON, EVERYONE. WE'RE ON A PATH TO FINISHING THE NDA THIS WEEK. THERE'S BEEN GOOD BIPARTISAN COOPERATION AND A STRING OF -- >> Reporter: HIS FELLOW SENATORS INCLUDING JOHN BARRASSO, A MEDICAL DOCTOR FROM WYOMING, EVENTUALLY HELPING McCONNELL AWAY FROM THE PODIUM. RETURNING MOMENTS LATER, THE SENATE'S TOP REPUBLICAN SHRUGGED OFF A REPORTER'S QUESTION ABOUT THE MOMENT. >> I'M FINE. >> YOU'RE FINE. YOU'RE FULLY ABLE TO -- >> YEAH. >> -- DO YOUR JOB. >> YEAH. >> Reporter: McCONNELL WHO IN JANUARY BECAME THE LONGEST PARTY LEADER IN SENATE HISTORY HAS RECENTLY HAD HEALTH CHALLENGES. HE HAD SHOULDER SURGERY AFTER A FALL IN 2019 AND SPENT SIX WEEKS RECOVERING FROM A CONCUSSION AND FRACTURED RIB SUFFERED IN A MARCH FALL AFTER WHICH HE HAS SOMETIMES STRUGGLED TO MAKE OUT QUESTIONS FROM REPORTERS. McCONNELL'S OFFICE HAS BEEN TIGHT-LIPPED ABOUT THE INCIDENT SAYING ONLY THAT THE SENATOR WAS FEELING LIGHTHEADED AND POINTING OUT HE ANSWERED REPORTERS' QUESTIONS SHARPLY AFTER HE RETURNED. >> IN NEW YORK TODAY TERRIFYING IMAGES AS A CRANE MORE THAN 40 STORIES HIGH CAUGHT FIRE AND COLLAPSED INTO A STREET BELOW. THE DEBRIS RAINING DOWN SENDING BYSTANDERS FLEEING. NEARLY A DOZEN PEOPLE WERE INJURED. WE GET MORE FROM EMILIE IKEDA. >> Reporter: IT STARTED AS A FIRE ROUGHLY 45 STORIES UP IN MIDTOWN MANHATTAN, BUT JUST AS FIRST RESPONDERS WERE ARRIVING ON SCENE, AN EVEN MORE TERRIFYING TURN. >> OH [ BLEEP ]. >> Reporter: THE BOOM OF THE CRANE COLLAPSED SENDING PEDESTRIANS BELOW SCRAMBLING TO SAFETY. >> I THOUGHT IT WAS ANOTHER TERRORIST ATTACK BECAUSE IT WAS A LOUD BANG. IT SOUNDED LIKE A BOMB. >> Reporter: THE FALLING CRANE ALSO STRUCK AND RATTLED A NEARBY HIGH-RISE APARTMENT BUILDING WHERE RESIDENTS WERE EVACUATED. >> OUR WHOLE FLOOR, ALL THE GLASS, DEBRIS EVERYTHING, IT'S MANGLED LIKE GODZILLA TOOK IT AND JUST CRUSHED IT IN HIS HANDS. >> Reporter: AUTHORITIES SAY AT LEAST 11 PEOPLE SUSTAINED NONLIFE-THREATENING INJURIES INCLUDING TWO FIREFIGHTERS. FIRST RESPONDERS CLIMBED TO NEARBY ROOFTOPS LEAVING THE CABIN CHARRED. ITS OPERATOR TRIED EXTINGUISHING THE FIRE BUT FLED WHEN HE COULDN'T. >> AS THE FIRE HEATS THE CABLE, THE CABLE WEAKENS TO A POINT WHERE IT LOSES ITS STRENGTH, AND THAT'S WHERE THE COLLAPSE OCCURRED. >> Reporter: PART OF THE CRANE AND THE 16 TONS OF CONCRETE IT WAS LIFTING PLUMMETING. IT WAS BEING USED IN THE CONSTRUCTION OF A 54-STORY MIXED USE BUILDING. WORKERS SAY THEY WERE STILL INSIDE AND FEARED FOR THEIR LIVES AFTER A SUDDEN BANG. AND YOU THOUGHT THE BUILDING WAS COLLAPSING? >> YEAH, YEAH, I THINK IT COLLAPSED BECAUSE I KNOW IT'S BIG. >> Reporter: IN 2016 A CRANE CRASHED IN MANHATTAN DURING A SNOWSTORM KILLING ONE MAN. TONIGHT, THE MAYOR SAYS NEW YORKERS SHOULD FEEL LUCKY THIS WASN'T MUCH WORSE. >> ALL OF THAT CONCRETE COULD HAVE STRUCK CIVILIANS AND THIS HAS SPREAD OUT THROUGHOUT THE AREA HERE, SO WE WERE EXTREMELY, EXTREMELY LUCKY THIS MORNING. >> EMILIE IKEDA NOW JOINS US FROM THE SCENE. EMILIE, WHAT'S NEXT THERE? >> Reporter: WELL, LESTER, IN ADDITION TO CLEARING OUT THE TWISTED CRANE YOU CAN SEE BEHIND ME, CREWS WILL BEGIN REMOVING THE REMAINING HANGING DEBRIS THAT STILL COULD FALL. THE CITY NOW INVESTIGATING WHAT WENT WRONG ALONG WITH THE COMPANIES INVOLVED. LESTER. >> ALL RIGHT, EMILIE, THANK YOU. >>> THERE ARE NEW DEVELOPMENTS ON THAT OHIO POLICE OFFICER CAUGHT ON BODY CAM UNLEASHING A POLICE DOG ON A BLACK TRUCK DRIVER AFTER A PURSUIT. CIRCLEVILLE POLICE SAY OFFICER RYAN SPEAKMAN HAS BEEN FIRED. THE VIDEO SHOWS SPEAKMAN RELEASING THE DOG ON THE DRIVER, WHO HAD HIS HANDS UP DESPITE A STATE TROOPER YELLING AT HIM NOT TO DO IT. >>> THE FEDERAL RESERVE TODAY RAISED INTEREST RATES AGAIN TO THE HIGHEST LEVEL IN 22 YEARS. CHAIR JEROME POWELL LEAVING THE DOOR OPEN FOR MORE HIKES IN THE BATTLE AGAINST INFLATION. TOM COSTELLO IS IN WASHINGTON. TOM, THIS AFFECTS ALMOST EVERY AMERICAN. >> Reporter: OH, IT DOES. CONSUMERS AND BUSINESSES CUT BACK ON SPENDING. NOW, THIS IS THE 11th RATE HIKE SINCE MARCH OF '22, AND THOSE MOVES HAVE HELPED BRING DOWN INFLATION FROM 9% TO 3% TODAY, BUT THE FED WANTS INFLATION AT 2%. SO, A QUARTER-POINT HIKE TODAY WITH ANOTHER RATE POSSIBLE, A MOVE POSSIBLE IN SEPTEMBER. HIGHER RATES MEAN MORTGAGE RATES COULD MOVE HIGHER, NOW ABOVE 7%. CREDIT CARD RATES ARE REALLY AFFECTED. WE'VE SEEN THE AVERAGE CREDIT CARD BALANCE NOW AT $5,700 WITH CREDIT CARD RATES AT 20%. IT WOULD TAKE 17 YEARS TO PAY IT OFF IF YOU ONLY MADE THE MINIMUM PAYMENT. MEANWHILE, WITH LOW UNEMPLOYMENT AND GOOD GROWTH, THE FED STAFF NOW AGREES WITH MANY BUSINESS LEADERS AND ECONOMISTS THAT THE COUNTRY MAY AVOID A RECESSION AFTER ALL. LESTER. >> ALL RIGHT, TOM, THANK YOU. >>> WE'LL TURN NOW TO THE UNRELENTING HEAT IMPACTING TENS OF MILLIONS ACROSS THE COUNTRY. HEAT ALERTS NOW UP FROM CALIFORNIA TO MAINE AND THREATENING AMERICANS' LIVES AND LIVELIHOODS. HERE'S MAGGIE VESPA. >> Reporter: TONIGHT, A RECORD-SMASHING SUMMER OF EXTREMES COAST TO COAST AS THAT TRIPLE-DIGIT HEAT WAVE STATISTICALING THE SOUTH FOR NEARLY A MONTH SPREADS INTO THE UPPER MIDWEST AND EAST COAST. >> I AM WALKING INTO A SAUNA. >> Reporter: 125 MILLION AMERICANS UNDER HEAT ALERTS FROM PHOENIX TO MINNEAPOLIS TO D.C. WHERE THE HEAT INDEX IS SET TO TOP OUT AROUND 106 DEGREES. TENS OF MILLIONS ALSO DEALING WITH VIOLENT STORMS. A MICROBURST BLOWING THROUGH BROOKLYN TUESDAY CLOCKING WINDS UP TO 70 MILES AN HOUR. IN THE ROASTING MIDWEST, THE UNBEARABLE HEAT DESTROYING LIVELIHOOD. >> I'VE NEVER EXPERIENCED A DROUGHT LIKE THIS. >> Reporter: 32-YEAR-OLD SETH'S FAMILY HAS OWNED THIS MINNESOTA FARM FOR FIVE GENERATIONS. BY NOW CORN SHOULD BE UP TO HIS CHEST, BUT AMID WIDESPREAD DROUGHT, HIS 5-YEAR-OLD TOWERS OVER SHRIVELED CROPS. HE ESTIMATES JUST 30% OF HIS CORN IS VIABLE AND HOPES TO BREAK EVEN. WHAT ARE YOUR CHANCES, DO YOU THINK? >> IT ALL DEPENDS IF WE GET MORE RAIN. I MEAN, IT'S -- THAT'S A MILLION DOLLAR QUESTION RIGHT THERE. >> Reporter: MEANWHILE, FEED PRICES FOR HIS CATTLE ALSO SKYROCKETING, AND IN A GROWING NUMBER OF CASES, THE PRODUCT ITSELF IS GOING UP IN FLAMES. LOCAL FIREFIGHTERS SAY IT'S SO HOT, HAY IS SPONTANEOUSLY COMBUSTING, BURNING CLOSE TO HALF A DOZEN BARNS IN THIS RURAL MINNESOTA AREA IN THE LAST MONTH INCLUDING SPIKE SPEED SPETON'S. >> I WAS DEVASTATED. I WAS DUMBFOUNDED. >> DO THE SUMMERS FEEL HOTTER? DO THINGS FEEL MORE EXTREME? >> I WOULD SAY WARMER AND MORE EXTREME. >> Reporter: THAT'S HOW IT FEELS. >> THAT'S HOW IT FEELS TO ME. >> Reporter: EXPERTS SAY THIS EXTREME HEAT PLUS WIDESPREAD DROUGHT COULD DRIVE UP FOOD PRICES, AND THEY SAY RAINFALL THESE NEXT FEW WEEKS IS CRUCIAL. LESTER. >> MAGGIE VESPA, THANK YOU. >>> ACTOR KEVIN SPACEY WAS CLEARED OF SEXUAL ASSAULT CHARGES TODAY IN THE UK. A JURY IN LONDON FOUND THE OSCAR-WINNING ACTOR NOT GUILTY OF SEXUALLY ASSAULTING FOUR MEN. SPACEY TESTIFIED IN HIS OWN DEFENSE WHILE ELTON JOHN ALSO PROVIDED TESTIMONY DURING THE TRIAL. >>> IN 60 SECONDS, THE LATEST ON AN ATTEMPTED COUP IN NIGER, AND OUR NBC NEWS EXCLUSIVE. HOW CLIMATE CHANGE IS FUELING UNREST IN WEST AFRICA. >>> PLUS, THE TROUBLES >>> WE'RE BACK WITH AN NBC NEWS EXCLUSIVE. INSIDE THE WEST AFRICAN COUNTRY FACING NEW POLITICAL UNREST TONIGHT. AN APPARENT COUP ATTEMPT IN ADDITION TO GROWING THREATS FROM TERROR GROUPS AND CLIMATE CHANGE. OUR COURTNEY KUBE ON THE FRONT LINES WITH THE AMERICANS LOOKING TO HELP. >> Reporter: TONIGHT, CHAOS IN THE CAPITAL OF NIGER AFTER WHAT APPEARS TO BE A COUP ATTEMPT AGAINST PRESIDENT MOHAMED BAZOUM BY HIS OWN SECURITY FORCES. THE LATEST FLASH POINT FOR PEOPLE ALREADY FACING THREATS FROM CLIMATE CHANGE AND EXTREMIST GROUPS, NEARLY EVERYONE HERE IN NIGER LIVES BELOW THE POVERTY LINE. MILLIONS OF PEOPLE DON'T HAVE ENOUGH FOOD, AND THE TERRORISTS HERE KNOW THAT. THEY OFTEN TARGET THESE VULNERABLE POPULATIONS, FORCING THEM TO EITHER FLEE THEIR HOMES OR JOIN THEIR TERROR GROUPS, AND THEN THERE ARE DISEASES LIKE MALARIA. LAST YEAR, OVER HALF THE CHILDREN UNDER 5 WHO DIED HERE WERE KILLED BY THE DISEASE, AND THE STORIES ARE HEARTBREAKING. WE MEET THIS 26-YEAR-OLD AT THE SMALL HUT WHERE SHE LIVES WITH HER FAMILY. USAID STAFF THERE TO PROVIDE FREE CARE. SHE'S ALREADY LOST ONE CHILD AND TELLS US SHE'S GETTING HER 2-YEAR-OLD SON ABDUL MALARIA TREATMENT BECAUSE IT KEPT HIM ALIVE LAST YEAR, BUT LIKE MOST CHILDREN HERE, ABDUL STILL FACES CHRONIC MALNUTRITION. ADDING TO ALL THIS, DROUGHT AND SOARING TEMPERATURES TURNING NEARLY 275,000 ACRES FROM FARMLAND TO DESERT EVERY YEAR. EXTREME WEATHER MADE EVEN WORSE BY CLIMATE CHANGE, AND THIS HUMANITARIAN CRISIS KNOWS NO BORDERS. IN NEIGHBORING BENIN WE MEET THIS MOTHER OF FIVE WHO WALKED OVER AN HOUR TO GET ONE OF HER DAUGHTERS TREATED HERE. SHE TELLS US SHE WANTS TO OPEN A HAIR SALON BUT DOESN'T HAVE ENOUGH MONEY, AND NOW SHE FEARS HER DAUGHTER MAY NEED SURGERY. WE TRAVELED HERE WITH AMERICAN MILITARY PERSONNEL. CAPTAIN STEPHANIE DERISO IS THE FIRST WOMAN TO LEAD A GROUP OF SPECIAL OPERATION TROOPS FOCUSED ON HELPING PEOPLE HERE IN BENNEN. >> YOU HAVE TO SHOW THE PEOPLE THAT YOU'RE HERE FOR THEM AND YOU CARE ABOUT THEM AND THEIR GOVERNMENT IS HERE FOR THEM. >> Reporter: THIS 29-YEAR-OLD BENINESE ARMY NURSE SAYS THIS OUTREACH IS WORKING. "THE LOCALS ARE NO LONGER AFRAID OF THE MILITARY AND THEY ARE OUR BROTHERS AND SISTERS NOW," SHE SAYS, GIVING THEM AN OPTION OTHER THAN JOINING TERROR GROUPS WHO THREATEN THEM IF THEY DON'T. TONIGHT, BRINGING TOGETHER THE MILITARY AND CIVILIANS WITH THE SAME GOAL. >> IT'S HELPING PROVIDE MUCH-NEEDED RESOURCES TO THESE POPULATIONS IN RURAL AREAS. >> Reporter: MEANWHILE, TONIGHT, THE U.S. IS CALLING ON THE PRESIDENTIAL GUARD TO RELEASE THE PRESIDENT WHO THEY ARE STILL DETAINING. LESTER. >> COURTNEY KUBE, THANK YOU. >>> WE'RE BACK NOW WITH OUR SERIES, "A.I. REVOLUTION," AND HOW THE INDUSTRY AROUND ARTIFICIAL INTELLIGENCE COULD BE A LIFELINE FOR A STRUGGLING AMERICAN CITY. CNBC'S DEIRDRE BOSA REPORTS. >> Reporter: WHILE THE GOLDEN GATE BRIDGE MAY BE THE MOST RECOGNIZABLE IMAGE OF THE CITY BY THE BAY, SAN FRANCISCO TODAY STRUGGLES WITH SCENES OF EMPTY STOREFRONTS, HOMELESSNESS, AND THEFT. PERCEPTIONS OF A CITY SPIRALING INTO WHAT HEADLINES ARE CALLING A DOOM LOOP. >> OUR CUSTOMERS ARE REALLY CONCERNED ABOUT THE STATE OF THE CITY. >> Reporter: THIS MAN RUNS RETAIL AT GUMP'S, A 150-YEAR-OLD SAN FRANCISCO BRICK AND MORTAR BUSINESS DATING BACK TO THE GOLD RUSH. HE SAYS FOOT TRAFFIC HERE IS DOWN UPWARDS OF 40% DUE TO THE LACK OF DOWNTOWN ACTIVITY. >> WHEN YOU WALK INTO DISTRICT, AND IT'S STILL PRETTY MUCH A GHOST TOWN, THAT HAS A HUGE EFFECT ON OUR BUSINESS. >> Reporter: GUMP'S IS NOW TRYING TO AVOID THE FATE OF NUMEROUS DOWNTOWN BUSINESSES THAT HAVE GIVEN UP ON SAN FRANCISCO'S DOWNTOWN. COMMERCIAL VACANCY RATES ARE AT A RECORD HIGH. NEARLY ONE-THIRD OF OFFICES EMPTY. THIS USED TO BE THE CITY'S MOST VIBRANT SHOPPING CENTER, BUT NOW IT IS ROW AFTER ROW OF CLOSED SHOPS, SINCE 2019 NEARLY HALF OF ALL STORES DOWNTOWN HAVE MOVED OUT, AND NO ONE IS RUSHING TO FILL THE SPACE, BUT JUST ACROSS TOWN, A FRESH ENERGY AND A HOPE THAT A NEW TECH BOOM DRIVEN BY ARTIFICIAL INTELLIGENCE IS HELPING BRING SAN FRANCISCO BACK. >> WE HAVE HUNDREDS OF PEOPLE WHO HAVE ACTUALLY WORKED IN THIS OFFICE. >> Reporter: SCALE A.I. WITH 600 EMPLOYEES IS A DECIDEDLY SAN FRANCISCO-BASED COMPANY. CEO ALEXANDER WANG SAYS HE NEEDS TO BE HERE AND WANTS TO SEE HIS STAFF IN PERSON. WHY BUILD A COMPANY IN SAN FRANCISCO? >> THIS IS WHERE THE INNOVATION IS. BY BEING IN SAN FRANCISCO, BY BEING IN THE BAY AREA, WE REALLY GET TO SUPPORT THE INNOVATION ECOSYSTEM AS IT'S ALL HAPPENING. >> Reporter: IT'S ALSO WHERE THE MONEY IS. IN THE FIRST QUARTER OF THE YEAR, NEARLY HALF OF ALL FUNDING FOR ARTIFICIAL INTELLIGENCE START-UPS WORLDWIDE WENT TO SAN FRANCISCO-BASED FIRMS. THE CITY'S MAYOR RECENTLY DECLARING SAN FRANCISCO THE A.I. CAPITAL OF THE WORLD. WHAT MAKES IT THE A.I. CAPITAL OF THE WORLD? >> THE 20 LARGEST COMPANIES IN THE WORLD, IN THE WORLD, 13 ARE IN THE BAY AREA, AND 8 ARE IN SAN FRANCISCO. >> WHY DO YOU THINK THEY'RE HERE? >> BECAUSE THIS IS WHERE THE TALENT IS. >> Reporter: MUCH LIKE THE TECH GIANTS OF SILICON VALLEY CREATED A BOOM IN THE BAY AREA, WHAT SOME NOW CALL CEREBRAL VALLEY IS STARTING TO BRING NEW COMPANIES AND PEOPLE INTO SAN FRANCISCO NEIGHBORHOODS AND OFFICES. NOT THAT THE MAYOR IS RELYING ON INDUSTRY ALONE. >> DOWNTOWN CAN BE SOMETHING THAT WE CAN REIMAGINE. WE HAVE TO DREAM BIG. WE HAVE TO THINK OF WHAT'S POSSIBLE, AND SAN FRANCISCO HAS ALWAYS BEEN THE PLACE TO PUSH THE ENVELOPE AND PUSH FOR WHAT'S POSSIBLE. >> Reporter: BUSINESSES OLD AND NEW ARE BANKING ON IT. FOR NBC NEWS, DEIRDRE BOSA, SAN FRANCISCO. >>> WHEN WE