‘Elonville’: Why is Elon Musk’s xAI buying homes instead of land for AI data centers?

# xAI Offers to Buy Mississippi Homes Amid Lawsuit Over Noise From AI Data Center Turbines

Residents of a Mississippi neighborhood troubled by the constant noise of gas turbines powering Elon Musk’s artificial intelligence operations are facing a proposed way out: xAI wants to purchase their homes, but the offer reportedly requires homeowners to agree not to participate in a lawsuit against the company.

Real estate agents representing xAI have been visiting homes in Colonial Hills, a neighborhood in western Southaven, Mississippi, to discuss potential property purchases. According to a recording of a conversation reviewed by *The Guardian*, one agent told a resident that the company intends to acquire 418 homes and that 18 homeowners had already agreed to sell. xAI has not responded to questions about those figures or the full scope of its proposed purchases.

The potential acquisition could cover much of the neighborhood, where homes have an average estimated value of approximately $180,000. The purchases would support xAI’s expanding operations around Southaven and nearby Memphis, Tennessee, by providing accommodation for company employees, according to the realtor and Southaven’s mayor.

The proposal comes after three major data centers were established in the Memphis-Southaven area over the past two years. Their expansion has generated concerns among residents about noise and the impact of the growing technology infrastructure on local living conditions.

## Gas Turbines at the Center of the Dispute

The controversy centers on a former Duke Energy property where 69 temporary gas turbines provide electricity for the new data centers. Residents say the turbines produce persistent noise and were installed without the necessary permits.

Elizabeth Rose, a piano teacher who lives about two miles from the xAI site, described the sound as a continuous rumble resembling an aircraft engine.

She told *The Guardian* that the noise has repeatedly disturbed her sleep, including during the early morning hours, and that she sometimes has to leave the area to get away from it. Rose said the sudden appearance of the power facility and its ongoing noise have significantly changed her experience of living in the neighborhood.

She is also concerned that the proposed property purchases could eventually extend across Colonial Hills, potentially transforming the residential area into a community dominated by the company's presence.

## Musk Accelerates AI Infrastructure Expansion

The dispute is unfolding as Musk pushes to expand the computing infrastructure needed to develop and operate xAI’s Grok chatbot.

Since July 2024, the company has established three large data centers in the Memphis and Southaven region: Colossus I, Colossus II and Macrohardrr. Musk has reportedly been spending as many as four nights a week in an Airstream trailer in the Memphis area while overseeing construction.

During a SpaceX earnings call this month, Musk described the growth of Grok as unusually rapid, saying he had not previously seen a product expand at such a pace.

The expansion reflects the broader competition among technology companies to build the computing capacity required for artificial intelligence. However, the development of large data centers has also prompted concerns in communities across the United States over electricity demand, environmental effects and the impact of industrial facilities on nearby residents.

## Residents Take Legal Action Over Noise

In June, three Southaven residents filed a lawsuit against xAI, alleging that the nearby power facility had caused persistent noise, vibrations and other disturbances affecting their homes and daily lives.

The company disputes the allegations and has previously said it wants to maintain positive relationships with neighboring residents. It has also stated that it reduced power output and built sound-dampening walls to address complaints about the turbines.

Jason Haley, one of the plaintiffs, has lived in his home for 20 years, with the power plant located approximately half a mile away. He said the combination of a high-pitched hum and a sound resembling an aircraft flying overhead has made it difficult to sleep.

Haley told *The Guardian* that the disturbance has forced him to leave his home or play music until he becomes exhausted enough to fall asleep. He also expressed frustration over what he described as unsuccessful attempts to obtain answers from local officials.

The dispute has changed his involvement in local issues. Haley began sharing videos on social media to document the noise around his property and eventually joined the lawsuit.

He also criticized Mississippi Gov. Tate Reeves, a Republican who supports AI development, after Reeves argued that limiting data center expansion would amount to surrendering technological leadership to China. Haley rejected the suggestion that opposing disruptive noise meant being against the country, arguing that companies and public officials should be held accountable when residents are affected.

## Home Purchase Offer Includes Lawsuit Condition

The proposed home purchases have introduced a new dimension to the conflict. In a letter delivered to residents, MZX, the xAI subsidiary operating the site, said it requires property for business purposes and is prepared to purchase homes in the surrounding area.

However, the offer reportedly includes a contractual condition requiring homeowners to agree not to participate in Haley’s class-action lawsuit against the company.

Property records in DeSoto County indicate that MZX has purchased five homes in Colonial Hills since October 9. These transactions suggest that some residents are willing to leave the neighborhood amid the continuing noise dispute.

Gavin Foust, a neighbor of Haley, said some elderly residents had recently agreed to sell their property. He expects additional homeowners may consider the offer as the situation continues.

Foust said the residents had intended to remain in their homes for the rest of their lives but were now considering moving to escape the disturbance caused by the turbines.

## A Wider Debate Over the Costs of AI Expansion

The situation in Southaven illustrates the tensions emerging between the rapid development of artificial intelligence infrastructure and the concerns of communities living near large technology facilities.

Companies such as xAI argue that extensive computing infrastructure is necessary to compete in the AI industry. Residents, meanwhile, are raising questions about noise, energy use, permits and the extent to which local communities should bear the consequences of that expansion.

The proposed purchases could offer some homeowners an opportunity to relocate, but the reported requirement concerning participation in the lawsuit raises additional questions about the relationship between property negotiations and residents’ legal claims.

As xAI continues expanding its operations around Memphis and Southaven, the dispute is likely to remain part of the broader discussion over how the United States balances technological development with neighborhood concerns and community rights.