Residents in a Mississippi neighbourhood say agents acting for Elon Musk’s xAI have offered to buy their homes at market value on one condition: that the owners agree not to join a lawsuit over noise from the company’s nearby power plant. The offers, reported in Southaven’s Colonial Hills neighbourhood, would see the purchased homes used to house xAI staff, and could eventually cover almost the entire neighbourhood if every target home were sold.
The Offer On The Doorstep
Agents for xAI have been going door to door in Colonial Hills, a neighbourhood on Southaven’s western flank, with offers to buy houses at market value. The condition is the part that has drawn attention: sellers would have to agree not to take part in legal action over noise from the power plant that supplies xAI’s data centres.
A letter from MZX, the xAI subsidiary that operates the site, was described as saying the company needs nearby property for business purposes and would buy homes on that basis. The arrangement is presented as a purchase, not a payment for the noise itself, and the homes bought so far are said to be intended as housing for company employees.
The scale is striking. A realtor working on the buyouts was reported, on the basis of a recording, as outlining a target of 418 homes in the neighbourhood, with 18 homeowners already agreeing to sell. County records were cited as showing five neighbourhood homes bought by MZX since 9 October, with the average local house price put at about $180,000.
The Noise Complaint Behind It
The buyouts sit alongside a lawsuit filed in June by three local residents, who complain of near-constant noise and vibrations from the power plant. Residents have described a continuous, high-pitched hum and a sound like an aircraft engine that does not stop, leaving some of them waking repeatedly through the night and struggling to sleep.
The plant sits on a former Duke Energy site and is described as running 69 temporary gas turbines. It powers three xAI data centres built in the Memphis and Southaven area since July 2024, known as Colossus I, Colossus II and Macrohardrr. One resident lives about two miles from the site, while a plaintiff lives about half a mile away.
Air pollution is a strand of the dispute. Regulators have determined that the turbines operated without federally required permits, according to the reporting, and the Southern Environmental Law Center has estimated health costs from turbine emissions at $44 million. In July, an agreement with regulators set out a plan to convert the plant to a facility by next summer.
Two Lawsuits, And A City Caught Between
The June noise case is not the only action. A lawsuit filed in April by environmental groups and the NAACP seeks to stop the turbines, and an attempt by the Justice Department to block that case on national security grounds was unsuccessful, according to the reporting. The buyout offers arrive while the company’s exposure on two fronts remains unresolved.
xAI did not respond to questions about the buyout numbers or plans, according to the reporting. The company denies all claims in the noise lawsuit, and has previously said it cares deeply about being a good neighbour, pointing to varied power output and sound-dampening walls built around the facility as evidence of that effort.
Mayor Darren Musselwhite has defended the development as a source of tax revenue for DeSoto County. He said the buyout was not intended to create a company town, describing it as homes for employees and a gesture for sceptical neighbours. He said noise remained a priority, but city monitors had not detected a breach of the 70-decibel limit.
That measurement is itself contested. Critics cited in the reporting point to evidence linking persistent noise at 50 decibels or more with adverse health effects, well below the city’s threshold. The gap between the two numbers helps explain why residents and officials can look at the same neighbourhood and reach very different conclusions about whether anything is wrong.
Why It Matters
The story matters because it shows how the physical footprint of the AI boom is colliding with the communities that host it. Data centres need enormous amounts of power, and the turbines built to supply it have turned a quiet suburb into a test case for how far a company can go to manage the consequences of its own infrastructure.
It raises a question about consent. A buyout at market value looks generous on its face, but when the price of selling is giving up the right to sue, the offer becomes a legal instrument as well as a property deal. How many residents accept, and on what terms, will shape whether the noise case retains enough plaintiffs to proceed.
For the wider industry, Southaven is a warning about the cost of speed. xAI built its Memphis-area capacity at remarkable pace, and the turbines, permits and neighbourhood relations have all become part of the bill. Other AI developers planning large power-hungry sites will be watching whether buying the neighbourhood turns out cheaper than fixing the noise.
Background
Residents are divided. Some plan to sell to escape the noise, some have refused because of the no-sue condition, and others say they are not bothered by the sound or welcome the jobs and business the development brings. The neighbourhood’s future now depends on which of those groups grows fastest, and on whether the planned permanent plant arrives on schedule.
Source: Guardian report
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