SAN FRANCISCO — After 18 years, Elon Musk will move X, formerly known as Twitter, out of San Francisco, according to Mayor London Breed’s office. The social media company has a long history with the city, but the billionaire entrepreneur, who acquired the platform in 2022, has often used his platform to bash the city’s progressive politics and homelessness crisis.
The social network’s departure from San Francisco will mark the end of an era for San Francisco’s downtown Mid-Market neighborhood, where city officials once courted tech companies with incentives dubbed the “Twitter Tax Break.” Musk made deep cuts to Twitter’s workforce when he acquired the company in October 2022, and X only has about 120 employees left in San Francisco, a person familiar with the company’s plans said. The employees will be moved to office space in San Jose and Palo Alto, where Musk’s AI start-up, xAI, operates out of, the person said, and the company will conduct a survey to figure out where individual employees want to work.
Ted Egan, San Francisco’s chief economist, said while Twitter and its workforce were once an important driver of foot traffic in the Mid-Market neighborhood, X never served the same role. He attributes that to the work-from-home policies of the pandemic, and Musk’s mass layoffs. “You never like to see a company move out of town, but it’s a much smaller company now, its future is uncertain and sometimes you have to look forward,” he said.
“We may have gotten the most out of it that we were ever gonna get,” Egan said.
Musk said in a post on X Monday that he had “no choice” but to leave San Francisco, appearing to blame the city’s business taxes. But earlier this month, he said he would move the company’s headquarters to Austin, citing a new Golden State law meant to protect LGBTQ children as the “final straw.” The New York Times first reported that X would be leaving San Francisco. Musk and X did not respond to a request for comment.
The billionaire has had a fraught relationship with San Francisco since he took over the social platform, and had already offloaded much of his office space in the city. X has been sued for failing to pay millions in rent and investigated for illegally converting offices into bunk rooms after Musk said he was sleeping on a couch on the seventh floor. Last summer, construction crews had to dismantle a giant illuminated “X” sign above the building after several residents of neighboring buildings complained of the blinding, flashing strobe light.
While Musk said in 2023 that he was committed to staying in the city — despite claiming that many offering “rich incentives for X to move its HQ out of San Francisco” — he has also decried the city in viral posts on X, calling it a “derelict zombie apocalypse.” Last month Musk said that he has had “enough of dodging gangs of violent drug addicts just to get in and out of the building.”
Breed’s office said in a statement to The Post that its focus “remains on working with and supporting the many businesses that call S.F. home.”
Twitter’s San Francisco office, inside an art deco building that was formerly a furniture showroom, has long been a symbol of the city’s relationship with the tech industry. The social network moved in after city officials in 2011 offered to waive the city’s 1.5 percent payroll tax for businesses that moved to the Mid-Market neighborhood, which was then struggling with high vacancies and visible homelessness.
The Twitter tax break was designed to bring new jobs and retail to the area as well as reduce crime, and the popular social media company was seen as an anchor tenant. When the tax break sunset after eight years in 2019, however, the results were mixed.
X is the latest major tech company to offload its office space in San Francisco, which has been struggling to lure office workers back downtown since the pandemic normalized working from home. While the office vacancy rate remains high, the mayor’s office sees the AI industry as a possible bright spot, with major companies like OpenAI, Anthropic and Scale AI, committing to the city.
But when it comes to X, Egan, the city’s chief economist, doesn’t see the exit as much of a loss for San Francisco.
“I just don’t see it as the force in tech that it was,” he said.