Elon Musk is trying to cut costs at Twitter as close to zero as possible while his personal wealth shrinks — and that includes falling behind on rent payments on the company’s offices.
Twitter owes $136,260 (£113,601) in late rent for its offices on the 30th floor of a building in downtown San FranciscoAccording to a lawsuit filed by the building’s owner last week.
The landlord at 650 California Street, which is not home to Twitter’s main San Francisco headquarters, sent the social media company a notice on December 16, saying it would default if payment was not made within five days. According to the case, five days passed without payment.
The landlord, Columbia REIT 650 California LLC, seeks gross damages for back rent, attorney fees and other costs. Twitter signed a seven-year lease for the offices in 2017. The monthly rent was $107,526.50 (£89,646) in the first full year, gradually increasing to $128,397 (£107,045) in the seventh year.
Twitter did not respond to a message for comment. The company no longer has a media relations department.
Musk bought Twitter for $44bn (£37bn) in October 2022, and the company plans to pay around $1bn a year in interest from the deal. Much of Musk’s wealth is tied to his ownership of Tesla shares, which have lost more than half their value since he took ownership of Twitter. He has sold nearly $23bn (£19bn) worth of shares in the electric vehicle company to fund the buyout since April, when he began building a position on Twitter. According to Forbes, he also lost the first place for the richest people in the world.
Musk defended his aggressive cost-cutting measures in a late-night Twitter space call last month.
“This company, basically, you’re in a plane that’s going down at high speed with the engines on fire and the controls not working,” Musk said on Dec. 21.
The company’s headquarters are located at 1355 Market Street, another San Francisco address where Twitter is behind on rent, according to the New York Times.
Without paying rent or laying off workers, Musk’s Twitter also auctioned off high-end office furniture, kitchen appliances and other memorabilia, Twitter had 7,500 full-time employees worldwide and free lunch and other offices. Concessions were common. An estimated three-quarters of Twitter’s workforce has left the company.
Among the Twitter auction items are a pizza oven, a 40-quart commercial kitchen floor mixer (retailing for about $18,000; bidding starts at $25), and high-end designer furniture like Herman Miller and Knoll Diamond chairs retailing in the thousands.
A Twitter Bird statue (bids start at $25) and a neon Twitter Bird light display (bids start at $50) are included in this fire sale-style auction reminiscent of the dotcom boom of the early 2000s, when failed tech startups were sold. Their decadent office supplies.