Future Of Twitter Office Footprint In Question As Musk Layoff Threat Looms
Firings began almost immediately after Elon Musk finalized a deal to purchase Twitter for $44B late Thursday, and layoffs are expected to follow, which could impact the company's substantial real estate portfolio.
Top Twitter leadership, including CEO Parag Agrawal, Chief Financial Officer Ned Segal and policy executive Vijaya Gadde, was the first to go, according to Reuters.
Reports leading up to the acquisition said that Musk planned to lay off up to 75% of the Twitter staff before a reversal on that figure earlier this week, but there are still expected to be some staff reductions, according to Bloomberg.
Layoffs could mean decreased office usage for the company, a major tech tenant in downtown San Francisco, at a time when the local office market is still struggling to recover from the pandemic.
Twitter occupies an estimated 1M SF in San Francisco's Mid-Market district, filled by as many as 2,500 employees. The company also maintains offices in cities across the country and around the world.
The buyout was rife with complications, with Musk terminating the agreement to purchase the company in July via a Securities and Exchange Commission filing before being ordered by Delaware Judge Kathleen McCormick to complete the deal by the end of this week, the New York Times reported.
Since the rumors of Musk purchasing Twitter first started to swirl, speculation has been rampant that he would relocate the company’s headquarters from San Francisco to somewhere in Texas, mirroring similar moves he made with Tesla and The Boring Co.
Meanwhile, Twitter has made moves to downsize its office footprint throughout 2022, with plans to vacate several offices globally following its attempts to sublease 100K SF in its headquarters in San Francisco earlier this year. The company cut its recruitment staff by 30% in the same week that Musk called off his initial bid.
Though the company has been committed to providing hybrid work solutions for employees, leading to its office pullback, it remains unclear if Musk will maintain this policy now that the company is under his tenure, given his public disdain for remote work.
UPDATE, OCT. 28, 5:07 P.M. ET: This story has been updated to reflect the known status of Twitter layoffs.
