Twitter Faces Rent Lawsuit as Elon Musk Continues to Cut Costs

Since acquiring Twitter for $44 billion last year, Elon Musk has aggressively sought to cut costs. About three-quarters of the social media company’s employees have left in the aftermath of the acquisition, some voluntarily and some involuntarily. Musk also has sought to auction off various items from the company’s past. These include distinctive objects like a Twitter bird statue and a neon Twitter bird light display, in addition to more mainstream furniture and equipment. For example, auction bidders might be able to acquire designer chairs or a pizza oven.

A lawsuit filed last week suggests that Musk and Twitter might have taken the cost-cutting agenda a little too far, though. Twitter operates offices on the 30th floor of 650 California Street in San Francisco, for which it signed a seven-year lease in 2017. (This is not its headquarters.) The landlord of the property, Columbia REIT 650 California LLC, recently sued the social media company for unpaid rent. According to the lawsuit, the landlord informed Twitter in mid-December that it would be in default on its lease if it did not pay overdue rent within five days. Since Twitter did not pay within the allotted time, the landlord proceeded with this action. It has asked the court to award damages in the amount of the unpaid rent ($136,260) in addition to costs like attorney’s fees.

Similar problems have arisen at other Twitter offices, including its headquarters at 1355 Market Street in San Francisco. The social media company reportedly failed to keep up with its rent at this property as well. As a result, Musk reduced the size of the headquarters by two-thirds. Twitter originally operated offices on six floors of the building but now has a presence on only two floors. In addition, Twitter moved out of its office in Seattle due to similar issues and may abandon its office in New York City.

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