One of Memphis’ biggest industrial buildouts is now carrying a very large unpaid-bill allegation. The CEO of an Ohio-based contractor says SpaceXAI still owes his company roughly $570 million for work tied to the company’s rapidly assembled AI data-center operation.
According to The Daily Memphian, the contractor’s total bill was about $1.5 billion, with approximately 40% allegedly still outstanding. The figures are rounded, but the basic claim is stark: hundreds of millions of dollars may remain in dispute on a project built at breakneck speed.
The report does not establish that SpaceXAI agrees with the contractor’s accounting, and it does not describe a court ruling determining that the money is owed. For now, this is a commercial payment allegation—not an adjudicated debt.
Why The Claim Lands At Memphis’ Colossus Site
The work is connected to Colossus, SpaceXAI’s first Memphis data center inside the former Electrolux plant in Southwest Memphis. The site includes 217 acres and a 785,000-square-foot building, according to a Phoenix Investors release announcing its $185 million sale to a SpaceX subsidiary.
That transaction shows the scale of the asset involved, but it does not answer the contractor’s central question: how much of the construction and installation work has actually been paid for. Industrial data centers are assembled from layers of contractors, equipment suppliers and specialty trades, so a dispute at the top of the chain can quickly become a problem for companies farther down the ladder.
The payment claim also arrives while SpaceXAI continues expanding its Memphis footprint. In June, the company bought about 13 acres near the city’s wastewater plant for $820,000, with plans for a facility that would convert treated wastewater into coolant for its supercomputer, Action News 5 reported.
Expansion Plans Keep Moving
The proposed water-recycling project had been paused while SpaceXAI prioritized other work, but Memphis Mayor Paul Young later said construction would resume no later than the first quarter of 2027. Elon Musk suggested the work could restart sooner, potentially in the final three months of 2026, according to a follow-up report.
SpaceXAI has made speed a central part of its Memphis pitch. On the company’s own Colossus project page, it says the facility was completed in four months after the company had been told a comparable build could take up to two years.
What The Contractor Dispute Could Clarify
The unanswered questions are practical ones: what the contracts require, whether invoices are being challenged, how much work was completed under change orders and whether any payment deadlines have passed. Public court filings, mechanic’s liens or a formal company statement could eventually provide a clearer accounting.
For Memphis, the dispute adds a financial wrinkle to a project already drawing attention for its size, speed and continued expansion. SpaceXAI may be selling computing power from Colossus to major technology companies, but the contractor’s allegation suggests the people who helped build the machine may still be waiting for their own payoff.
