5 ms·
Not when you have leases that are 5 or 10 years for 7500 or 8000 employees, which is what they had before musk took over. Commercial offices and real estate in
by genmud 3y ago
Not when you have leases that are 5 or 10 years for 7500 or 8000 employees, which is what they had before musk took over.
Commercial offices and real estate in big cities is fucking expensive. Like $100/year per square foot for nice office space at the peak. Each employee probably requires a minimum of 100sqft average to account for offices, conference rooms, etc. 10k x 1000 = 10m/year per 1k employees.
Figure like 1m or 2m a month per 1000 employees after you factor in all the other maintenance and required stuff for an office that size.
I would be surprised if they are not sitting anywhere from 70-100m/year of real estate costs.
Maybe 30-60m/year if they didn’t build out office space for their employees hired during the pandemic or got fantastic lease terms (which if they did, they would probably be subletting at a profit).
If you want to break your lease, in this commercial real estate market, guess what? Tough shit. You can pay the lease in its entirety or sublet the space.
- rchaud 3y ago$100m/yr for office costs are high, assuming these bills are actually being paid everywhere. They've been evicted from their Colorado office and have been sued for not paying rent at a SF office,[0] Either way, it pales in comparison to the $300m/qtr they're on the hook for for interest payments to banks that financed $13bn of the deal. [0]https://globalnews.ca/news/9385713/twitter-overdue-rent-san-francisco-offices/ https://globalnews.ca/news/9385713/twitter-overdue-rent-san-...
- sidewndr46 3y agoWow, they owe $1.2 billion US just in interest each year? I knew the terms were nuts, but I had no idea it was that bad.
- genmud 3y agoJust because they have been evicted doesn’t mean they aren’t responsible for the remainder of the lease. Like when he tried to not close the twitter deal, just because you don’t wanna pay doesn’t mean you can arbitrarily back out of a contract.
- rchaud 3y agoOK, but having millions in accounts payable is not the same as actually having it flow out of the company and hit your operating cash reserves. That's what happening with their loan payments, at a significantly higher scale than vendors they simply haven't paid, and are hoping to shake down for better terms.