Elon Musk's SpaceX buying out 418 homes near flagship AI data center, but only if they drop participation in lawsuit — report claims the company is targeting an entire neighborhood, but will only buy from people who don't pursue noise pollution complaints

SpaceXSI, Elon Musk’s data center business powering Grok, is reportedly buying 418 properties in Colonial Hills, Southaven, which sits about half a mile from the powerplant that the company will use to power its data centers in the area. According to The Guardian, real estate agents have been going door to door, offering owners deals on behalf of the company provided that they do not join a class-action lawsuit over the noise pollution coming from the gas turbines that power its GPUs.

MZX, the SpaceXSI subsidiary that operates the Colossus II site, circulated an open letter to nearby residents, saying that it “requires property for its business purposes,” with Southaven mayor Darren Musselwhite saying that they will be used to house SpaceXSI staff that the company will need as it expands operations. Musk himself is reportedly staying in the area in an Airstream trailer four nights per week to personally oversee the data center build-out needed to power Grok AI.

The bigger issue here, though, is the requirement that sellers must sign an agreement that prevents them from joining the ongoing case against the company for noise pollution. The Colossus 1 and 2 sites have been in hot water since they started operating, primarily for their use of unpermitted turbines and the air pollution that they bring. SpaceXSI has since promised that it will remove all its unpermitted turbines in a year, especially as its 1.2-gigawatt powerplant comes online. However, this apparently hasn’t resolved the noise pollution issue that the community has been complaining about.

“It sounds like an airplane engine but it’s continuous, it’s incredibly loud. I’ve been woken up at 2am by it, I’ve been woken up at 3am by it. I sometimes have to just get away from it because it makes me so angry,” piano teacher Elizabeth Rose, who lives a couple of miles from the site, told the publication. One of the plaintiffs in the class-action, Jason Haley, also said to The Guardian, “There’s a high-pitched hum and then another sound like an airplane over your house. It’s been so torturous I can’t sleep; I just leave the house or turn on some music until I fall asleep completely exhausted. It drives you insane. You also lose hope because you’re being ignored or dismissed. There’s no escape.”

The company has denied all the allegations against it, saying that it has adjusted its power output and installed sound-dampening walls to reduce the impact on the neighborhood. Musselwhite also said that city monitors have not detected the site breaching the local ordinance limit of 70 decibels, although some experts say that persistent noise as low as 50 decibels could have adverse health impacts.

Opposition against the noise pollution and Musk’s purchases aren’t unanimous, though. Some residents aren’t as affected by the noise pollution, while local businesses are experiencing increased activity. Other people have also agreed to sell just so they could get away from the noise. The mayor says that the buyout isn’t intended to turn Colonial Hills into a company town. “The buyout has multiple purposes which are to provide homes for some employees and a goodwill gesture from a good corporate citizen for those who perceive the industrial development near them as negative,” Musselwhite said.

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