Musk's xAI offers to buy 418 homes in Southaven, Mississippi, if owners skip noise lawsuit

The offer in Southaven

Agents working for xAI, the AI company of Elon Musk that merged into SpaceX in February, have been knocking on doors in Southaven, Mississippi. They offer to buy homes at market value, put at $180,000 each, if owners agree not to join a lawsuit against the company. According to a recording of a conversation that The Guardian heard, a realtor told one resident that the target is 418 homes and that 18 owners have already agreed to sell. xAI did not answer questions about those numbers, and it denies all claims in the noise lawsuit. The city's mayor said the homes would house xAI staff as the company keeps growing in the area.

Homes targeted for purchase418

Owners already agreed to sell18

Homes targeted for purchase

418 homes

Owners already agreed to sell

18 homes

Data from the article text

Residents describe constant noise

Three residents filed the lawsuit, which describes near-constant noise and vibrations from the company's data centers and gas turbines. Sources give different dates for the filing, with June and August both cited. Some tenants in the neighborhood say they are already being pushed out, with 60 days' notice after their landlords agreed to sell. Elizabeth Rose, a piano teacher who lives about two miles from the site, described the noise in blunt terms.

“It sounds like an airplane engine but it's continuous, it's incredibly loud”

Rose said the power plant, a former Duke Energy site housing 69 temporary gas turbines, began its low-level hum in August of last year. She said the noise has woken her in the early hours of the morning, and she feels the company is trying to extend the buyout to the entire neighborhood.

Permit allegations and penalties

Mississippi's Department of Environmental Quality issued an enforcement notice to MZX Tech LLC, a subsidiary that handles the company's local infrastructure. The notice says three sites began construction without the stormwater permits required. Macroharder and Macrohard are already operating, while the third site, Minihard, is still under construction. The state is seeking daily penalties of up to $25,000, and exposure across the three facilities reaches $6.1 million. SpaceXAI says it is cooperating with state officials and discussing a settlement that would cover all three locations, though no final terms have been disclosed. The allegations surfaced in a filing with the Securities and Exchange Commission.

Maximum penalties across three sites6.1

Unpaid bill claims (more than)220

Maximum penalties across three sites

6.1 $ million

Unpaid bill claims (more than)

220 $ million

Data from the article text

Parallel legal fights

The NAACP's suit alleges that dozens of methane-burning turbines in Southaven lack permits. Earlier in October 2026, a federal court stopped an attempt by the Trump administration to end that case. In October 2026, Memphis's city council rejected a proposed one-year ban on AI data center development and passed a 135-day construction pause instead. The company also faces claims of more than $220 million for unpaid bills tied to work at the Memphis and Southaven sites. Earlier in 2026, Mississippi's governor publicly backed a company plan worth more than $20 billion for the area.

Expansion across the state line

The Guardian counts three data centers built in Southaven and neighboring Memphis, Tennessee, over the past two years. TechRadar describes a fourth computing facility inside Memphis, where the company began building its AI infrastructure in 2024. The facilities are used to train and run xAI's AI models, including the Grok chatbot. The sites sit close to the state border, which is why Mississippi's environmental rules apply to them.