MEMPHIS, Tenn. – It’s the most expensive rent in all of Memphis.
Artificial intelligence company Anthropic has agreed to pay SpaceX more than $1.25 billion per month to use xAI’s supercomputer power in Memphis, according to documents filed with the United States Securities and Exchange Commission. SpaceX filed its initial public offering Wednesday as Elon Musk prepares to take the company public.
Anthropic, which runs Claude Code, has agreed to pay that amount monthly through May 2029, unless terminated by either party “upon 90 days’ notice.”
The monthly rent of $1.25 billion is more money than the city’s general fund for an entire year.
“Memphis should not be a playground for millionaires and billionaires,” said Sarah Houston, executive director of Protect Our Aquifer.
A month ago, xAI decided to pause construction of its $80 million wastewater treatment plant that would reduce the computer’s reliance on the Memphis Sand Aquifer. A city spokeswoman told FOX13 the sale of the land to xAI for the graywater plant was recently finalized. About a month ago, Musk said the company would revisit the project.
“We need to focus on finishing Colossus 2 and ensuring it is extremely stable, then will build the water recycling plant,” Musk wrote on X on April 9th.
However, Houston criticized the city for not holding xAI accountable for finishing the project.
“They had opportunities to get a formal agreement, a contractual obligation on this water reuse plant, and they never did,” she said.
In a newsletter on April 10th, Mayor Paul Young said he pushed company representatives to make sure the project is finished.
“Completion is not optional,” he wrote. “It is a requirement tied to how this project operates in Memphis.”
Residents of nearby Boxtown hope they can see investments in the community surrounding the supercomputer. Last year, the Memphis City Council passed an ordinance to allow 25% of the property tax revenue to benefit the neighborhoods where the data centers are located.
“I think we should have a portion of the earnings,” said Farris James, who lives about a mile from Colossus 1.
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