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Twitter owes several million dollars for renting offices in San Francisco and London - the money will be recovered through the courts.

Published: 2023-01-24

At the end of October, Elon Musk became owner and CEO of Twitter, and in the weeks that followed, he struggled with costs "like crazy," in his own words. In addition to a significant reduction in staff and, accordingly, labor costs, the cost of renting office space was also cut, and excess furniture and equipment were put up for auction. Now the landlord of Twitter's San Francisco headquarters is seeking to recover more than $6 million from the company after the company hasn't paid rent for two months.


Sri Nine Market Square LLC, owner of the Twitter headquarters building, sued the tenant to not only recover a portion of the January rent, but also force Twitter to increase the amount of the letter of credit, which is a bank guarantee that the company will fulfill its obligations on rent payments. Prior to the transition of Twitter under the control of Elon Musk, the size of the letter of credit barely covered the amount of the monthly rental payment - $ 3.6 million. The terms of the agreement stated that in the event of a change in ownership or organizational structure, Twitter should increase the letter of credit to $ 10 million, but so far the management of the social network refuses to do this.


The December rent of $3.36 million was collected through a letter of credit, but the existing limit is not enough to cover the January rent of $3.42 million in this way. It turns out that Sri Nine is now trying to recover from Twitter is over $3 million in rent for January and is also pushing for an increase in the letter of credit. The lawsuit was filed in California State Court. Twitter leases almost 43,000 m2 of office space in an eight-story building in San Francisco. Now, a symbolic one US dollar remains on the Twitter bank account used for settlements with the landlord.


In addition, it is reported that a lawsuit has appeared in British jurisdiction, as the management company Crown Estate has sued Twitter for late payment for the lease of an office building in London. In fact, this building belongs to the British royal family, so the lawsuit could have the most serious consequences for Twitter.