Elon Musk said he has no plans to relocate X, the social media platform formerly known as Twitter, out of the San Francisco Bay Area despite financial enticements dangled by other cities looking to lure the company.
Musk wrote on the social media platform on July 29 that the "rich incentives" will not lead him to move his company, a business that has been reported to be looking to reduce costs and accused of not paying its rent in some locations. He didn't name any cities he said were offering incentives.
San Francisco "is in a doom spiral with one company after another left or leaving," he wrote. He added that as a result, some people will "expect X will move too. We will not. You only know who your real friends are when the chips are down. San Francisco, beautiful San Francisco, though others forsake you, we will always be your friend.”
Representatives for X could not be reached to comment. Musk has faced pushback for rebranding Twitter to X in recent weeks, and for a large X logo placed upon the top of the company's headquarters building last week, reportedly without the correct permits. Media reports said workers were taking down the X sign from the building late Monday.
Musk bought what was then known as Twitter for $44 billion in 2022.
San Francisco has been struggling to fill its downtown area office towers, with more than 1,300 leases set to expire by the end of next year. Even so, X may have limited allure as a tenant because the firm has been accused of failing to make payments on its own office spaces in San Francisco and faced an eviction order in Colorado.
Two businesses founded by Musk: Tesla Inc., which left the San Francisco Bay Area in 2021, and The Boring Co. are among hundreds of companies that have expanded or relocated to Austin, Texas, since 2020. The moves of those companies prompted speculation on whether the headquarters of the social media business also could be relocated to Austin.
The San Francisco Bay Area held onto its No. 1 spot on CBRE's annual "Scoring Tech Talent" report analyzing the ability of the top 50 U.S. and Canadian markets to attract tech employees based on a variety of factors, including graduation rates, tech job concentration, tech labor pool and real estate and labor costs.
The San Francisco Bay Area also ranked as the most expensive market to operate a 500-person tech office with 60,000 square feet with annual estimated costs at $79 million, according to CBRE's 2023 report. The 60,000 square feet represents a 20% reduction in estimated office space, the first decrease in the report's 11-year history, reflecting a broader change in how offices are being used in various industries.
Annual average costs in Austin, meanwhile, to operate a 500-person tech office with 60,000 square feet is estimated to be about $52.1 million, according to CBRE.