In Southaven, Mississippi, the AI boom has arrived with an offer. Real estate agents working for Elon Musk's xAI are knocking on doors in the Colonial Hills neighborhood, offering to buy homes near the company's data center and power plant - as long as the sellers promise not to sue over the noise.
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The offer
The approach comes from MZX, the xAI subsidiary that operates the company's Southaven site. In a letter delivered to neighborhood households and first reported by the Mississippi Free Press, the company said it "requires property for its business purposes" and offered to purchase real estate "in exchange for, among other things, a release of all claims related to the lawsuit."
Accepting means giving up any claim in a class action brought by three residents over the power plant's noise - a case known as the Haley action - and agreeing not to sue independently. xAI has denied the lawsuit's allegations and has previously said it intends to be a good neighbor.
The scale could be considerable. A realtor told one resident the company aims to purchase 418 homes and that 18 homeowners have already agreed to sell, according to a recording of the conversation obtained by the Guardian. DeSoto County records show MZX has bought five neighborhood homes since October 9. Renters are feeling the effects too: some have been told to leave within 60 days after their landlords agreed to sell, The Verge reports.
The noise
The dispute centers on a power plant xAI built on a former Duke Energy site to feed its data centers. Sixty-nine temporary gas turbines installed there generate what residents describe as near-constant noise and vibration. The NAACP has separately sued the company, accusing it of operating dozens of unpermitted methane gas turbines in Southaven.
"It sounds like an airplane engine but it's continuous, it's incredibly loud," Elizabeth Rose, a piano teacher whose home sits about two miles from the site, told the Guardian. "I've been woken up at 2am by it, I've been woken up at 3am by it." Gavin Foust, a paramedic who grew up in the area, compared the sound to "a jet engine" and said he will not sell if it means giving up the right to sue. "Why would you put it in a city? Why push people out?"
xAI rejects the claims. The company says it cares deeply about "being good neighbors" and points to sound-dampening walls and varied power output at the site. It did not respond to the Guardian's questions about the buyout figures.
The buildout behind it
xAI has constructed three data centers across the Memphis-Southaven area in two years - Colossus I and Colossus II in Memphis and Macrohardrr in Southaven - part of an expansion Mississippi's governor has touted as a more than $20 billion investment. Musk has been spending up to four nights a week in an Airstream trailer near the sites overseeing construction, the Guardian reports. The company officially became SpaceXAI in July and has lately been rebranded as SpaceXSI.
The growth has met political friction. Last week the Memphis City Council voted down a one-year moratorium on AI data center development, adopting instead a 135-day pause on construction. SpaceXAI faces up to $6.1 million in potential civil penalties for environmental law violations, along with more than $220 million in claims of unpaid bills for work at the Memphis and Southaven sites.
In Southaven, where the average house price is about $180,000, the buyout could reshape entire streets. The mayor and the realtor say the purchased homes will house xAI staff as the expansion continues. Rose fears the neighborhood will simply become "Elon Musk's little playground, basically. Elonville."
Xavier Willis · October 29, 2026 · Tech