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According to the landlord Twitter is supposed to have been “in default” on their lease as of Dec 21. It’s like the second sentence of the Bloomberg article we’r

by rsfern 4y ago

According to the landlord Twitter is supposed to have been “in default” on their lease as of Dec 21. It’s like the second sentence of the Bloomberg article we’re commenting on, before the subscription fold.

phpisthebest 4y ago
I would be interested in knowing how many other tenants this landlord has chosen to file suit on when the tenant is 7 days over due (in default in 21st, filed the suit on the 29th)? Seem very aggressive. I wonder if politics has any bearing on their choice to file? Or the fact that Elon has publicly been considering closing the SanFran HQ?
- sheepscreek 4y ago
  It’s very likely this isn’t their first time running behind on rent.
- woodruffw 4y ago
  I assume they’re quick to file lawsuits with larger clients because of the correspondingly larger financial liability involved (large office space, large rent, unclear corporate finances). That seems like a very normal reason to be “fast on the draw,” all incentives considered.
- sschueller 4y ago
  Doesn't in default mean they had several reminders to pay and have now defaulted and invalidated their lease agreement?
  - phpisthebest 4y ago
    As soon as your 1 day late you are in default. Most organizations however give noticed and plenty of time before filing law suits thus my question. The "news" here seems to be lacking any context, and I assume bad intentions on the part of NY Times and Bloomberg so...
    - jcranmer 4y ago
      The article is too vague on details, and I don't see the actual court filing readily accessible (bad journalists! always give a link to court filings!). But given the timeline and the wording, it seems likely to me that Twitter has not paid its rent for November or December--in other words, it's not one, but two missed payments. If that is indeed the case, then I do not find it all surprising that a lawsuit would be so aggressively filed after the second missed payment. Even if not the case, Twitter has had very public issues which make it extremely likely that it is intentionally not paying the bills that are due. Thus, if the landlord wants to get its money, it either has to get Twitter to renegotiate its contract to one that it is willing to pay, or go to court to force Twitter to abide to the contract (including, potentially, invoking early termination clause). I don't know how much Twitter is behind on to this landlord, but the initial filing costs to the landlord are likely to be in the realm of a few thousand dollars, so it doesn't take much for it to be worth it to the landlord to sue pretty aggressively.
      - mjcl 4y ago
        I found it here[1] on the SF court website. It looks like they didn't pay December rent, due on the 1st. They gave them 5 days notice on the 16th and by the 29th they still hadn't paid. [1] https://webapps.sftc.org/ci/CaseInfo.dll?SessionID=333998CD01D7A39D111303A7A384330B99C22596&URL=https%3A%2F%2Fimgquery.sftc.org%2FSha1_newApp%2Fmainpage.aspx%3FWeb_Server%3Dimgquery.sftc.org%26MINDS_Server%3Dhoj-imx-01%26Category%3DC%26DocID%3D08386263%26Timestamp%3D20230101123858%3D842b0c4f2c773e742c517071a9e8e8d391bef2bb https://webapps.sftc.org/ci/CaseInfo.dll?SessionID=333998CD0...
- criley2 4y ago
  [flagged]
  - spamizbad 4y ago
    It’s really not just an Elon or Trump thing. I used to work for a firm that did market feasibility studies and we had some multi-millionaire developers that didn’t pay us for our work despite having the cash to do it. And we are talking about a mere $9000. You couldn’t send it to collections so you had to just politely nag them until they got sick of you calling and paid their bills. The process took about a year and maybe 50 very nice phone calls.
  - butlerm 4y ago
    Unless Twitter has no assets of any marketable value (which obviously isn't the case, the company itself just sold for 44 billion dollars) the landlords will get paid, worst case by having Twitter issue additional stock in a debt for equity swap.
    - deleted 4y ago
      [deleted]
    - cykros 4y ago
      Many have been estimating it at well under a $10 billion valuation. Elon Musk just became the first person to lose $200 Billion. I'd not be so quick to assume creditors are all getting paid here.
      - butlerm 4y ago
        If Twitter ceased to exist as a service then I agree creditors probably would not get paid or at least not in full. Liquidation isn't all that likely though. It is more likely that creditors would end up in control of the business, and that is worth something unless a Twitter style social media network is actually unsustainable as an economic enterprise.
        4y ago
- thinkindie 4y ago
  I don't understand the urge to see politics everywhere, even in a normal business practice.
  - IntelMiner 4y ago
    If you boil everything you disagree with down to "politics" then you can put it in a neat little box and pretend it doesn't exist, or that you're "above" it It's intellectually dishonest and absolutely insulting
- amalcon 4y ago
  The fact that Twitter currently has loan payments in excess of last year's profits could be a factor. Delaying means they will be more likely to be entangled in a bankruptcy and potentially get a worse outcome if they are. Even a low probability bankruptcy would encourage some urgency.
  - oneoff786 4y ago
    I don’t know anything about Twitter’s books but Loan payments in excess of profits doesn’t mean you’re insolvent. It doesn’t even mean you’re losing money. You can be gaining money each year while paying more in loans than you take home in profit.
    - amalcon 4y ago
      The key thing here is that the loan payments are new, and are greater than profits were before the loan payments. That doesn't necessarily mean they are losing money -- revenue could have increased, or costs decreased, to make up the difference. Losing money also wouldn't mean they're insolvent -- that only happens once liabilities exceed assets. Still, it's definitely a signal that creditors will take note of. Good luck renting an apartment as an individual with books that look like that.
      - oneoff786 4y ago
        Ehhh… loans are of course an important part of the books, as is profit, but I would hold that profit/loan payments is an obscure and unhelpful metric that a competent analyst is unlikely to utilize.
        Macha 4y ago
        Hmm, if you had net profit of X, and suddenly have a new expense of N * X, where N is greater than 2, I think that's worth taking note of, be it low payments, a lawsuit settlement, or otherwise.
        4y ago
- dragonwriter 4y ago
  > I wonder if politics has any bearing on their choice to file? Or the fact that Elon has publicly been considering closing the SanFran HQ? I suspect a bigger the fact that Elon has repeatedly publicly indicated things like that Twitter has been barreling toward bankruptcy since around the time of his offer to buy, and that a filing may be imminent within the next year. (Now, those public statements have been largely to deflect public criticism of his management decisions and bully employees into accept poor working conditions, but creditors can hear and react to them, too.)

by rsfern 4y ago

phpisthebest 4y ago

I would be interested in knowing how many other tenants this landlord has chosen to file suit on when the tenant is 7 days over due (in default in 21st, filed the suit on the 29th)? Seem very aggressive. I wonder if politics has any bearing on their choice to file? Or the fact that Elon has publicly been considering closing the SanFran HQ?

sheepscreek 4y ago
It’s very likely this isn’t their first time running behind on rent.
woodruffw 4y ago
I assume they’re quick to file lawsuits with larger clients because of the correspondingly larger financial liability involved (large office space, large rent, unclear corporate finances). That seems like a very normal reason to be “fast on the draw,” all incentives considered.
sschueller 4y ago
Doesn't in default mean they had several reminders to pay and have now defaulted and invalidated their lease agreement?
- phpisthebest 4y ago
  As soon as your 1 day late you are in default. Most organizations however give noticed and plenty of time before filing law suits thus my question. The "news" here seems to be lacking any context, and I assume bad intentions on the part of NY Times and Bloomberg so...
  - jcranmer 4y ago
    The article is too vague on details, and I don't see the actual court filing readily accessible (bad journalists! always give a link to court filings!). But given the timeline and the wording, it seems likely to me that Twitter has not paid its rent for November or December--in other words, it's not one, but two missed payments. If that is indeed the case, then I do not find it all surprising that a lawsuit would be so aggressively filed after the second missed payment. Even if not the case, Twitter has had very public issues which make it extremely likely that it is intentionally not paying the bills that are due. Thus, if the landlord wants to get its money, it either has to get Twitter to renegotiate its contract to one that it is willing to pay, or go to court to force Twitter to abide to the contract (including, potentially, invoking early termination clause). I don't know how much Twitter is behind on to this landlord, but the initial filing costs to the landlord are likely to be in the realm of a few thousand dollars, so it doesn't take much for it to be worth it to the landlord to sue pretty aggressively.
    - mjcl 4y ago
      I found it here[1] on the SF court website. It looks like they didn't pay December rent, due on the 1st. They gave them 5 days notice on the 16th and by the 29th they still hadn't paid. [1] https://webapps.sftc.org/ci/CaseInfo.dll?SessionID=333998CD01D7A39D111303A7A384330B99C22596&URL=https%3A%2F%2Fimgquery.sftc.org%2FSha1_newApp%2Fmainpage.aspx%3FWeb_Server%3Dimgquery.sftc.org%26MINDS_Server%3Dhoj-imx-01%26Category%3DC%26DocID%3D08386263%26Timestamp%3D20230101123858%3D842b0c4f2c773e742c517071a9e8e8d391bef2bb https://webapps.sftc.org/ci/CaseInfo.dll?SessionID=333998CD0...
criley2 4y ago
[flagged]
- spamizbad 4y ago
  It’s really not just an Elon or Trump thing. I used to work for a firm that did market feasibility studies and we had some multi-millionaire developers that didn’t pay us for our work despite having the cash to do it. And we are talking about a mere $9000. You couldn’t send it to collections so you had to just politely nag them until they got sick of you calling and paid their bills. The process took about a year and maybe 50 very nice phone calls.
- butlerm 4y ago
  Unless Twitter has no assets of any marketable value (which obviously isn't the case, the company itself just sold for 44 billion dollars) the landlords will get paid, worst case by having Twitter issue additional stock in a debt for equity swap.
  - deleted 4y ago
    [deleted]
  - cykros 4y ago
    Many have been estimating it at well under a $10 billion valuation. Elon Musk just became the first person to lose $200 Billion. I'd not be so quick to assume creditors are all getting paid here.
    - butlerm 4y ago
      If Twitter ceased to exist as a service then I agree creditors probably would not get paid or at least not in full. Liquidation isn't all that likely though. It is more likely that creditors would end up in control of the business, and that is worth something unless a Twitter style social media network is actually unsustainable as an economic enterprise.
      - 4y ago
thinkindie 4y ago
I don't understand the urge to see politics everywhere, even in a normal business practice.
- IntelMiner 4y ago
  If you boil everything you disagree with down to "politics" then you can put it in a neat little box and pretend it doesn't exist, or that you're "above" it It's intellectually dishonest and absolutely insulting
amalcon 4y ago
The fact that Twitter currently has loan payments in excess of last year's profits could be a factor. Delaying means they will be more likely to be entangled in a bankruptcy and potentially get a worse outcome if they are. Even a low probability bankruptcy would encourage some urgency.
- oneoff786 4y ago
  I don’t know anything about Twitter’s books but Loan payments in excess of profits doesn’t mean you’re insolvent. It doesn’t even mean you’re losing money. You can be gaining money each year while paying more in loans than you take home in profit.
  - amalcon 4y ago
    The key thing here is that the loan payments are new, and are greater than profits were before the loan payments. That doesn't necessarily mean they are losing money -- revenue could have increased, or costs decreased, to make up the difference. Losing money also wouldn't mean they're insolvent -- that only happens once liabilities exceed assets. Still, it's definitely a signal that creditors will take note of. Good luck renting an apartment as an individual with books that look like that.
    - oneoff786 4y ago
      Ehhh… loans are of course an important part of the books, as is profit, but I would hold that profit/loan payments is an obscure and unhelpful metric that a competent analyst is unlikely to utilize.
      - Macha 4y ago
        Hmm, if you had net profit of X, and suddenly have a new expense of N * X, where N is greater than 2, I think that's worth taking note of, be it low payments, a lawsuit settlement, or otherwise.
        4y ago
dragonwriter 4y ago
> I wonder if politics has any bearing on their choice to file? Or the fact that Elon has publicly been considering closing the SanFran HQ? I suspect a bigger the fact that Elon has repeatedly publicly indicated things like that Twitter has been barreling toward bankruptcy since around the time of his offer to buy, and that a filing may be imminent within the next year. (Now, those public statements have been largely to deflect public criticism of his management decisions and bully employees into accept poor working conditions, but creditors can hear and react to them, too.)