After splurging $44 billion to acquire Twitter in 2022, Elon Musk began literally and figuratively gutting the company. First, came the massive culling of its workers. Then, came the degradation of the site and selling off its memorabilia. Now, the company is looking to shed most of its San Francisco headquarters.
According to real estate firm JLL—which has confirmed to The Standard that it has been hired to represent the company—Twitter, now known as X, is subleasing its “excess space” at 1355 Market St., which totals roughly 460,000 square feet.
Previous reporting stated X was subleasing its entire San Francisco headquarters, which a JLL spokesperson has since said is incorrect. Instead, the company will continue to occupy a portion of office space that has been actively used by the company’s remaining skeleton crew of employees for most of the past two years.
X is also the tenant of a 330,000-square-foot adjacent building, located at 1 Tenth St., which had already been on the market (and sitting vacant) even prior to Musk’s acquisition.
X did not respond to a request for comment. However, once his takeover was completed last year, Musk ordered all of the company’s employees back to work in person.
Current verified X employees on the anonymous jobs platform Blind said as recently as this week that “HR tracks badge data” and “SF employees are required to [return to office]. But they laid off so many they’re not using a lot of the space.”
It is not immediately clear how much space X employees currently occupy in the building. A spokesperson from JLL declined to comment on how much “excess space” it was marketing for sublease.
As of publishing, current job postings on the company website show multiple listings for openings in San Francisco, as well as X’s other satellite offices across the world, including Europe, Asia and the Middle East.
Altogether, X is on the hook for roughly 800,000 square feet of office space at the near-century-old Art Deco building in San Francisco’s Mid-Market neighborhood with deals that expire in 2026 and 2028.
Representatives from X’s landlords, Shorenstein Properties, did not respond to a request for comment. The two sides were previously locked in a legal battle over millions in unpaid rent, but the lawsuit was dropped by Shorenstein in March.
For his part, Musk has savaged what he has characterized as the degradation of San Francisco’s downtown likening the neighborhood in one tweet to a “derelict zombie apocalypse.” However, in a previous post, he pledged that the company would stay in the city even as it is offered incentives to move away.
Musk’s company has been embroiled in multiple disputes since his takeover. Last summer, the company ran afoul with the city’s Department of Building Inspection for erecting a giant X sign on top of the building without proper permits. City officials also investigated the company earlier that year after six former employees alleged that the X leadership team broke laws by turning parts of the office into sleeping quarters for employees working late.
The company is also facing a string of lawsuits accusing it of firing more than 6,000 employees without contractually obligated severance payments. On Tuesday, Musk defeated one of those lawsuits after a federal judge ruled in favor of X Corp.
As recently as January of this year, Musk pledged to form a new 100-person office in Austin, Texas to police content on the social media platform, according to a report by Bloomberg.
Steve Gibson, the executive director of the Mid-Market Business Association said like most of Musk’s moves with respect to X, there’s still a lack of clarity on the future of the company’s presence in San Francisco.
He admits that the pullback or pull out of X from the neighborhood could be a negative in the short-run, but could end up being a positive if it ends the longstanding will-they, won’t-they conversation.
“Having someone in who is active and wants to be there is better than a tenant where everyone’s wondering what’s going on,” Gibson said. “Let’s just move on.”