General Motors recently announced that it is moving its global headquarters downtown from the Renaissance Center to the Hudson’s Detroit development, relocating the automaker’s headquarters after nearly 30 years on the Detroit riverfront. GM has declined to specify any financial details regarding the new deal. However, a recent report provides some insights into potential expenses for General Motors as it transitions to the new space.
According to Crain’s Detroit Business, the new office space at Hudson’s Detroit, managed by Dan Gilbert’s Bedrock LLC, may cost General Motors approximately $59 per square foot per year, translating to about $8.85 million annually for 150,000 square feet on a 15-year lease. This figure does not include additional costs such as electricity, which would add to the overall expense. The move includes significant logistical considerations as well, with moving costs estimated between $5 to $7 per square foot at the low end, and potentially as high as $12.50 to $15 per square foot depending on various factors.
The interior build-out at Hudson’s site is also a considerable expense, with recent increases in labor and material costs pushing these figures even higher. Estimates for building out new office spaces have surged from $70 per square foot a few years ago to between $130 and $150 per square foot today. However, General Motors’ planned space layout, which emphasizes open areas with private offices for executives, could potentially differ in cost.
Despite these substantial expenses, the move could provide General Motors with a more modern and strategically located headquarters, offering advantages that may justify the costs. The potential for rent concessions and the strategic placement of GM’s employees in a vibrant part of downtown Detroit are seen as beneficial for both the company and the city’s broader economic environment.
GM Authority covered the move announcement earlier in the week, during which General Motors’ commitment to Detroit and its historical presence in the city were emphasized. During the announcement, GM CEO Mary Barra highlighted the new headquarters as a space designed to meet the evolving needs of their workforce, with features that encourage collaboration and innovation. This relocation also opens up redevelopment opportunities for the Renaissance Center and the surrounding riverfront area, potentially leading to a significant transformation of these key Detroit landmarks.
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Beats dumping a bunch of money in an old train station….away from restaurants, apartments / lofts and general things to do / visit in a city.
Some of us familiar with the origins of the Ren Cen like to refer Ford’s train station boondoggle as Ren Cen 2.0.
Just like his uncle Henry 2 did with the Ren Cen, Bill Ford decided to through a ton of company resources at what in reality is little more than a philanthropic project.
*…to throw a ton…
Alfred have you been to corktiwn
Unfortunately, like many trends of the 70's, the design of the Ren Cen doesn't leave much room for improvement... Ford's investment in the Train Station, along with this move by GM into the former Hudson's location, both serve as good news for anyone worried about Detroit's role as the 'Motor City.'
You can love or hate what Dan Gilbert is doing in Detroit, but I wouldn't bet against him. If it weren't for all his real estate moves, Detroit would NOT be experiencing this 'renaissance' (irony noted), the Pistons and Lions would still be in the suburbs, and who knows whether the Illitch family would have had the staying power to keep the Red Wings and the Fox Theatre in the City.
As for the Ren Cen, it will be interesting to what Gilbert and Bedrock will do with it. With it being one of the largest riverfront locations and its placement on an international border, maybe Dan can flip it from being a '70's split level' into a modern day 'mid century modern...'
You’re right, Dan will explore all possibilities to reinvent the Ren Cen but local news reports say that the possibility of tearing it down is not off the table.
What an incredible waste that would be but it’s size, interior design and overall economics have long worked against it. Those issues have only been magnified in today’s environment.
I do hope it survives in one form or another. For better or worse it’s really become the center piece of the city.
I'm with you on the Ren Cen. I was one of the first GM employees to move in there in April, 1997. Not sure whether the eventual plan will include knocking it down, but suspect Dan's experience will be tested.
And in another piece of irony, if it does come down, I'll probably watch it live, as I did from the Ren Cen view back on October 24, 1998.
Now if only we could get our outlying location offices, adorned with mauve carpeted "walls," yes I said walls, updated even by 20 years to the mid 2000's, that would be an improvement. I'm not holding my breath on that so instead I'm planning a 40th anniversary of the " last time pink offices were a thing," for this coming summer. Get on the list so I know who's bringing what. Thanks ahead of time.
What a colossal waste of money.
Gm. Go back to building real cars and improve your portfolio of cars people want for a change.
Uh, seems like a LOT of money to spend building out NEW office space as more and more employers and employees embrace the work from home remote office concept. By the time this reno is finished, they will most likely not even need the massive space. And be searching for sub-leasees.
A "more strategically loated headquarters"... Has the author of this article ever even been Detroit? While I do agree the RenCen isn't exactly located in the center of Downtown, we are literally talking about s difference of 3-5 city blocks... A more "strategically located" headquarters location would've been on the grounds of the Warren Tech Center with the engineering staff. Try to justify this with whatever logic you wish to fabricate, but the fact is that the once largest corporation in the world is such a shell of it's former self that it's now able to consolidate it's entire world headquarters to only 150,000 square feet of office space spread over two floors of a building. That's just sad...
I guess you missed the memo where nearly 3/4 of World Headquarters employees moved out to Warren several years ago. And GM requires all employees to work in office at least 3 days per week. The employees at the RenCen are upper management and IT. This will not be a hit to Detroit as they have already had that.
Everything is done with computers And email it really doesn't matter where your headquarters is. The plants are what you need to be close enough to. And that has nothing to do with headquarters. so much for prices of cars. And trucks ever going down. Let's throw money at a fricking office.
Before Formula One abandoned Detroit for Belle Isle, I used to watch the Detroit Grand Prix (when it really was Grand Prix) from my friend's office in the Ren Cen. That was convenient and fun. Racing with bathrooms and a kitchen/snacks just steps away. Ahhh, the good 'ol days.