Glad I don't have Elon Musk as a tenant!

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Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
3y
Quote from @Adrian Clapp:
  • Twitter has not paid rent for its global offices or San Francisco headquarters in weeks, the report said, as Musk’s team has been trying to renegotiate the terms of the company’s lease.

https://www.cnbc.com/2022/12/1...

Actually that is a common tactic when a commercial tenant is losing money and office space is so available. 

Some things Elon Musk does I like, some I don't like. And no, I wouldn't have him as a tenant. But then, I wouldn't have my brother as a tenant either. ;-)

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  • Account Closed
    Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
    3y
    Quote from @Adrian Clapp:
    • Twitter has not paid rent for its global offices or San Francisco headquarters in weeks, the report said, as Musk’s team has been trying to renegotiate the terms of the company’s lease.

    https://www.cnbc.com/2022/12/1...

    Actually that is a common tactic when a commercial tenant is losing money and office space is so available. 

    Some things Elon Musk does I like, some I don't like. And no, I wouldn't have him as a tenant. But then, I wouldn't have my brother as a tenant either. ;-)

    3Reply
  • Scott E.
    Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
    3y

    According to their financial statements Twitter pays over $300,000,000 per year in lease payments. This is across 1,700,000 million square feet of office space, plus a bunch of other space they rent for their servers.

    Their space in San Francisco alone is ~700,000 square feet. And the rent rate for class A office in San Francisco can be as high as $100/PSF. 

    The landlords who lease spaces like this are in the big leagues. I wouldn't mind being one of them. I'm sure they aren't happy, but they can probably afford Twitter going a few weeks without paying rent.

    1Reply
  • Paul De Luca
    Real Estate Agent · Chicago, IL · Member since 2018 · 1k+ posts · 1k+ votes
    3y

    Working from home looks pretty appealing now, huh? Would save a lot of money on leasing office space...

    "In an effort to cut costs following Elon Musk’s chaotic $44 billion acquisition of Twitter, the social media company has stopped paying rent, according to a report from The New York Times."

    Landlords HATE this one simple hack tenants use to save money - stop paying rent lol

    0Reply
  • Ronald RohdePro Member
    Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
    3y

    Another reason I don't buy office. 

    0Reply
  • Henry ClarkPro Member
    Developer · Member since 2020 · 4k+ posts · 4k+ votes
    3y

    Don’t do Twitter and don’t know Elon.  I do know company managers who don’t change lanes and have their companies die using the same model.  As far as the landlords go you’re talking large REITS and insurance companies.  They should know all their locations need to average out or they need to change their models.

    Same issues/concerns I have just at a lower relative dollar level.

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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    3y

    @Adrian Clapp

    This is very common - during covid many companies sought relief and many are still doing so. Only reason why this is news is for media to blast musk

    I don’t like or hate the guy, but find this article comical as it’s going on everywhere.

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  • Joseph Gozlan
    Real Estate Agent · Plano, TX · Member since 2015 · 734 posts · 511 votes
    3y
    Quote from @Ronald Rohde:

    Another reason I don't buy office. 


     It happens in retail as well. Especially during COVID it happened a lot. 

    Most commercial owners would prefer to take a temporary reduction than to evict a business and then wait to find another tenant. I know a few landlords that were not willing to work with the tenant during COVID and that space is still vacant...

    1Reply
  • Ronald RohdePro Member
    Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
    3y
    Quote from @Joseph Gozlan:
    Quote from @Ronald Rohde:

    Another reason I don't buy office. 


     It happens in retail as well. Especially during COVID it happened a lot. 

    Most commercial owners would prefer to take a temporary reduction than to evict a business and then wait to find another tenant. I know a few landlords that were not willing to work with the tenant during COVID and that space is still vacant...


     Another reason I don't buy retail.

    0Reply
  • John M.
    Investor · Fairfax, VA · Member since 2015 · 1k+ posts · 796 votes
    3y

    I gave concessions to two retailers during the 1st year of Covid.  They were mom and pop operations.  One paid 1/2 rent for a year, and the other paid just the expenses for the year.  Oh and a 3rd stopped paying rent all together for two months (Major Corporate Brand), so I was forced to renegotiate with them.  The negotiation ended well as I gave them the two free months of breathing room, if they resigned their lease extension early.

    1Reply
  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    3y

    Some of this is likely strategic, but he's had such high turnover I wouldn't be surprised if some stuff is just falling through the cracks. If I remember right, he lost a lot of his accounting team and entire tax team during the turnover. If that's the case, I'd imagine there's more then a few people gone who had some obscure knowledge of these contracts etc and more stuff will slip through.

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