It could be a sign of financial trouble for Musk’s Twitter, and it’s definitely a bad sign for downtown SF’s office space recovery, that the social media company just put all 800,000 square feet of its Ninth and Market headquarters up for sublease.

The famed/infamous Twitter tax break of 2011 was supposed to revitalize the mid-Market area by exempting companies from payroll taxes on new employees if they moved into that area. (That law sunsetted in 2019.) But man is it ironic, considering news that broke late Thursday in the Chronicle that Twitter, now Elon Musk’s X, is putting the entire Twitter headquarters building up for sublease, raising the distinct possibility that Twitter will entirely vacate the 1355 Market Street building which the Twitter tax break originally drew it to.

The Chronicle’s report notes that it’s actually two buildings being put up for sublease; the 1355 Market Street Xitter headquarters, plus the attached One Tenth Street building that had already been put up for sublease at the height of the pandemic. X has not commented, as the company has never returned press comment under Musk's tenure, and does not even seem to have a comms department. But the Chronicle did get confirmation from the real estate firm JLL that the firm is indeed marketing the entire space for sublease.

"X, one of the greatest technology companies in the world, has spared no expense on the design of their headquarters," JLL broker Mike Sample told the Chronicle. "The company that steps up and acquires this real estate will have Class A office at an incredible value and attract the Bay Area’s top talent."

This might indicate that Musk is toying with the idea of moving the Xitter headquarters to Texas, or somewhere else. Or it may just be confirmation that the company has too much office space on its hands, considering Musk fired more than half of the company in late 2022. Or it could be related to how Twitter is just not making so much money these days, considering most of the ads you see on the platform are for low-rent brands like Cheech and Chong gummies and chewable generic Viagra. (But since the company is no longer public, we only have Musk's word on how it's doing.)

The sublease offer indicates that X might choose to hold on to part of its offices, giving another company the option of taking just a portion of the space, however if someone wants all 800,000 square feet, that is on the table. X could then seek cheaper offices in the city or on the Peninsula, or Musk could decide to relocate the entire company as he (sort of) did with Tesla.

Bloomberg has a new report today on how Twitter’s Tucker Carlson/Don Lemon streaming thing has been a massive flop. And do recall that despite Musk’s talk of implementing “cost savings,” he’s paying spectacular amounts of debt service to the Saudi and Qatari oligarchs who put up the money for his $44 billion Twitter takeover.  

There is a chance that Twitter/X might still occupy some of the space, but the Chron reports its being marketed as “one large headquarters opportunity.”

You will of course recall that Musk was sued for not paying rent on 1355 Market Street by landlord Shorenstein Properties, though the Chronicle reports the lawsuit was dismissed earlier this year. There have also been the nutty stories of Musk having a giant flashing ‘X’ logo illegally placed on the building’s roof, and the unpermitted bedrooms used as employee sleeping quarters, but those were both one-day distractions of Musk’s erratic decision-making.

Musk did get some good news earlier this week that one of several ex-employee lawsuits against the company pertaining to unpaid severence was dismissed by a judge.

What is a longer-term issue here is that Xitter’s new subleasing plans likely means more office vacancy downtown, at volumes that even these trendy but small AI startups cannot possibly fill.

Related: X’s SF Landlord Is Suing Over Unpaid Rent, Seeking $13.6 Million [SFist]

Image: SAN FRANCISCO, CALIFORNIA - JULY 24: A building tenant looks out a window after letters were removed by workers from the Twitter sign that is posted on the exterior of Twitter headquarters on July 24, 2023 in San Francisco, California. Workers began removing the letters from the sign outside Twitter headquarters less than 24 hours after CEO Elon Musk officially rebranded Twitter as "X" and has changed its iconic bird logo, the biggest change he has made since taking over the social media platform. San Francisco police halted the sign removal shortly after it began. (Photo by Justin Sullivan/Getty Images)