General Motors Discussed Selling Renaissance Center As Part Of Restructuring Effort
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General Motors initiated a massive North American restructuring effort this past fall, but it didn’t go as deep as perhaps some executives wanted.
A Sunday report from Crain’s Detroit Business has sources on the record claiming GM was interested in selling the Metro Detroit Renaissance Center, which serves as the automaker’s global headquarters. GM reportedly initiated discussions with Dan Gilbert, the billionaire mortgage and real estate businessman who has purchased many Detroit properties. Gilbert has been keen to redevelop Detroit’s waterfront properties.
According to sources speaking to the publication, talks between GM and Gilbert didn’t progress very far. One sticking point was a costly upgrade to the properties HVAC system. The building, which was constructed in the 1970s and 1980s as Ford’s headquarters, features an outdated HVAC system that would cost more than Gilbert wanted to invest.
Although one source said a sale is still partially on the table to Gilbert, GM is reportedly not seeking out any other buyers at the moment. Neither Gilbert’s Bedrock real estate company nor GM commented on the speculation and report.
The Renaissance Center’s potential sale isn’t a surprise. GM canceled planned renovations to the sprawling skyscrapers in 2017 as it prepared for its cost-cutting measures in 2018. Exiting the building would likely save the automaker millions after it presumably consolidated elsewhere. GM has also looked to offload the Marriott hotel across the street from the Renaissance Center for a reported $45 million.
GM bought the Renaissance Center in 1996 for $70 million. Today, it covers 5.5 million square feet, houses GM, and provides space for 50 non-GM office tenants and 60 retail outlets.
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Source: Crain’s Detroit Business
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While the move there was good for Detroit it was not good for GM.
GM would be better off making a efficient addition to the tech center and putting everyone in one efficient place.
These trophy buildings are like trophy wives where they take your money and leave you with high. expenses when they get old.
It wouldn’t be surprising either if they sell the building and then lease back the portion they use. A lot of companies like to do this, lets you redeploy the capitol you have tied up in the building
Ford left it for a reason!
Ford left because they sold the building to Renaissance Ventures, who then sold it to General Motors. GM and Ford were in the Renaissance Center at the same time. I’m pretty sure that it was because they didn’t want GM as their landlord.
Ford left and sold it because of the cost and moved back to the glass house in Dearborn that originally was their headquarters.
The high cost of the expenses drove Ford to Sell it to the Venture. GM just happened to be the sucker who bought it.
GM could operate out of a much smaller lower cost complex.
It was never Fords HQ, Ford built it in 1976 as part of a downtown renewal project and had offices in it, but Fords HQ has always been the “Glass House” in Dearborn, built in 1956.
It would be a blow for Detroit city if left but on-paper Warren tech would be a better location.
Currently Shanghai is considered for relocation… That’s where GM sells more cars anyway.
Vlad yes they sell more cars there but GM is still an American company.
Toyota sells more cars here but they are still based in Japan.
The GM money comes back here.
Doubt that “money comes back here”. Most countries require all profits to be spent as investments within that country.
If they ‘lease out the unused parts’ that feels like another round of white collar layoffs.
A lot of GM’s suppliers and ad/digital agencies have moved downtown to be closer to GM.
If they move to Warren, it kinda stifles the burgeoning downtown rebirth.
Interesting to see what happens ?
Those suppliers and digital agencies would offer a discount if GM would move to Warren.
The Downtown rebirth has been going on for how long now? The government there needs to get their own people in order before they could do much for down town. They are still very corrupt.
Best thing is to sell the building to Dan Gilbert and let him do something with it.
GM’s HQ was always in Downtown, before 1996 it was at the original “GM Building” on Grand Avenue.
All i can say is: Damn! The building look’s worth more than 45 million! W/O the HVAC system updated: good bye plant’s & HUMAN AIR QUALITY!! That’s a SAFETY HAZARD!!
It was estimated to be over 12 billion to re-build in around 2008. Big question is why this is an issue when GM replaced the HVAC system when they bought the building. The concrete “berms” held the old system in front of the building. That was a surprise move considering GM still used 1,900 window air conditioners in the old headquarters at time of departure.
Face it, GM’s braintrust is in Warren; the Ren Cen is a little more than a mailing address. Although I am confident that DHAM will be spared, the potential loss of that plant would be a bigger blow to Detroit than GM moving to Warren. The Ren Cen is sure to find another buyer and tenant fast; there is certainly no guarantee for another automaker at DHAM.