We reported last week that the current plan for the Renaissance Center in Detroit is for two of the towers to be demolished and the other three to be renovated after GM moves out and into Hudson’s Detroit as its new headquarters.
However, that plan is contingent on receiving $250 million in public funds to make it a reality. That sizable subsidy is facing an uphill battle with lawmakers in Lansing, prompting GM to threaten to tear down all five towers at its own expense if the taxpayer money doesn’t come through. GM has confirmed this ultimatum in a statement to the Detroit Free Press.
“Our desire is to preserve the iconic skyline that is synonymous with Detroit by funding the overwhelming majority of the project in partnership with Bedrock – but all options remain on the table,” said GM spokesman Kevin Kelly in a statement. “If it ultimately comes to demolition, General Motors is willing (to) cover the cost, so the site doesn’t fall into disrepair.”
GM says it would rather destroy the buildings than see them rot, but it’s most likely using the Renaissance Center, which includes Detroit’s tallest skyscraper, as a bargaining chip to secure public funds that would help cover the cost of the planned demolition of two of the towers.
“It’s not uncommon that big corporations, when they want to do large-scale projects, present things in an either-or fashion to shape the debate in the direction they would like,” University of Michigan architecture professor Craig Wilkins said. “The idea of ‘if you don’t go with this, then we’ll just tear it all down’ seems like extortion to me, and I don’t think the public should allow itself to be extorted.”
Lawmakers in the Michigan state government see the demolition threat as a way to get the state to pay for profitable projects for GM and developer Bedrock. “The nerve that this corporation and this billionaire have to ask for public assistance for a project that they’re going to profit off of is absolutely absurd,” Democrat State Representative Dylan Wegela told the Detroit Free Press, referring to GM and developer Dan Gilbert.
The original partial demolition plan appears to be the most likely outcome for the Renaissance Center, but that could change with enough opposition in Lansing.
Comments
Just another corporation looking for a handout. I don’t necessarily have a problem with it if it creates value. However, to ask for govt money to tear down two towers and alter the skyline is insane.
It’s being reported in the local news that gm is really just extorting the state and city for the public money. Basically either give us $250M in state funding or we’ll tear down the whole structure and leave a big gaping hole in Detroit’s skyline/waterfront.
I guess nothing should really surprise us anymore with this leadership team.
GM is going to do whatever is best for them and shareholders like me. If the lowest cost solution without government assistance is tearing the whole thing down, they should do it. I wish Ford’s management was as focused on profits and shareholder value as GM’s is.
gm is very good at focusing on short-term dividends and stock price- like by buying shares to artificially raise the stick price. Problem is it’s mortgaging the future for these short term gains.
So Tigger, what should GM have done with the money they spent on dividends and buybacks that returned value to shareholders like me? What are your brilliant suggestions for what GM should do with their best in the US industry profits?
gm should have reinvested in their aging product lineup such as commercial vans- Ford’s running circles around them in that category. How about a real midsize SUV? How about backfilling some of their idle and underutilized in the US by repatriating production like a REAL American car company would? You may want to google “stakeholder approach”. With this approach communities, employees, dealers, customers- and shareholders benefit long term. The most successful organizations follow this approach.
They should declare the building to be of significant historical significance owing to the late John Portman being its architect and thereby prohibit its demolition. It is, after all, one of Portman’s not-yet-fully-appreciated 1970s era masterpieces. Portman pioneered the inwardly oriented atrium concept hotels which the Renaissance Center is an early example of.
Every day GM does something else to make me, their former biggest fan in the world, dislike them even more. GM has already gotten enough taxpayer funds. This threat is insulting to good people everywhere.
Tearing down the Ren Cen would be like tearing down the Empire State building or the Gateway Arch.
How??
The Ren Cen defines Detroit’s skyline the way the arch defines St Louis’s and the Empire State Building defines NYC’s
This is brilliant. A real FAFO moment for a giant corporation asking for taxpayer money.
Build back better. Right…
I agree with Rocket. Save the buildings. Turn them into museums or put government offices in them. Do something with them, but it’s a waste to spend millions just to tear down perfectly functional buildings.
And you’ll end up with something like the Uniroyal plant site up the street- an overgrown fenced off eyesore- hardly a welcome gateway to downtown Detroit.
I am with GM on this one. Since no one wants to lease them and thus maintain the buildings, best to clear the land. Cut your losses and move on. Otherwise, people will complain about it every day creating negative publicity for GM. The negative publicity will cost way more than the cost to demolition. If declared historically significant then they should be signed over to the state or city.
So a vacant fenced off lot will be a better use of that land?
When Ford bailed GM tried to save this complex. But due to the way the city is run poorly and Covid GM is expected to sit on a money losing property that no one wants to come in to use or buy?
If the city wants it that bad let them buy it. Or talk Dan Gilbert into buying it.
Contrary GM does not have endless cash in pocket. I expect they have already tried to sell but the building needs work.
The image of the GM building is not good for GM but losing tons of money year after year is even worse.
How about those wanting to save the building get together and use their collective money. If this was Atlanta, LA or Dallas it would have sold. This is Detroit. Cold, crime ridden and run down. The last time I walked up past there we got hit up for money on every block.
I visited the center building in November 1989, even went to the rotating restsurant on the top floor. If it is the tallest in Detroit, keep it and remove the other four.
ok then demolish entire detroit we do not need it
Oh, and your not going to get hit up for money in Atlanta or LA.. : )
I forgot to mention it was -4 degrees at the time.
If you want this building why don’t you buy it?
Rather ironic that when the RenCen was built in the 1970s as Ford headquarters, it has been reliably written that Ford’s suppliers’ arms were twisted to donate to the project (at the risk of losing the Blue Oval’s future business). Maybe GM should twist the arms of their (foreign) suppliers (like those in China)!
This goes back to Harry Pearce who was one, if not the only, driving force behind buying this place. It should have been obvious that it was not a brilliant move.
That was late 90’s. Why that happened instead of the natural move to Warren or points north? Who knows. It’s a cluster for the employees. I was one of the first ones moved down there while a lot of the ford guys were still leaving. Just a long drive. I escaped within 6 months but the majority of employees got stuck. Then the addition of that winter garden! More money down the tubes.
All true. Not many remember that Vice Chair Harry Pearce who was the Corporate Council (aka glorified lawyer) was the driving force behind the purchase.
I had an office in there too not long after the purchase. I was fortunate enough to have onsite parking but I tried to spent most of my time at the Tech Ctr. I felt bad for the people that had the usual hour commute only to have an off-sight parking spot then have to take a shuttle ride to the building. I told HR they could reassign my spot but they refused.
One day after lunch, a small group us is rode up the elevator with Pierce. With obvious pride in his voice he asked us how he liked the new building. He was clearly fishing for an enthusiastic response. After a long pregnant pause, one coworker simply said “it’s a hell of a long drive”. Dead silence after that but we all appreciated our coworker’s candor. He was braver than we were.
I would save the buildings and either make them a Hotel or Condominium Residence especially with having the rotating restaurant on the top. Lots of costly renovations and remodeling would have to be done to make them Luxury Hotels or Condos. Another option would be to move the Cadillac Corporate Headquarters into the building.
GM should level every plant it built in China also- they fell for the oldest Chinese trick in the book- they taught them how to build cars- China copied the plans and builds their own now
Just write it off like they just did with $5 billion in China.
Would it be fair to say this goes back to the Triple Zero plan. GM has thrown away so much money on Cruise and Ultium with no return on those investments yet, and there may never be that now it’s hard to sustain a glamorous (for Detroit) and costly headquarters building on top of those other losses, plus mounting losses in China.
I wouldn’t give Mary 2cents , if GM wants to save money get rid of Mary and over paid ceo’s that are not designing vehicles that customers want . When did GM start building engines -transmissions, no model year goes by without one of them not being recalled for major repairs or replacement . Customers are the worst advertisement. .Where the hell is quality control ..
GM is gaining market share and is by far the most profitable of the US 2.5 Automakers, why would you want to get rid of their current management team? Would you rather they have the Ford, or worse yet the Stellantis management team?
Gaining market share? The last time I looked gm lost about 75 percent of the US market and went from the world’s biggest to the world’s seventh biggest automakers.
GM reported full-year 2023 revenue of $171.8 billion.
I think they can afford to pay for demo themselves.
Call their bluff , cut all top gm executives by $10 million, that’ll pay for demolition .
No Extortion !
Detroit had 6,221 homeless people in 2023 . Could these not be used to help with the homeless problem in Detroit?
Good on GM. I’m not sure why everyone is trying to paint them as the villain here. Commercial real estate is in a recession, possibly depression, with limited to no upside currently — especially for older, outdated buildings. The land value is probably worth more than the RenCen buildings right now, hence why complete demolition makes perfect sense.
GM does not “owe” anyone with these buildings, iconic Detroit skyline or not. They own the property and can do with it what they will. If the city, taxpayers, government, private enterprise, etc. — or some assembly thereof — want to save it, let them “pay up or shut up…”
… but for GM, it makes zero sense to sink hundreds of millions of dollars into converting and updating these buildings, when they: 1). Won’t be able to make their investment back; 2). Would be tied up in construction, legal, and environmental entanglements for YEARS; 3). Has absolutely nothing to do with helping the business succeed, and in fact, actively harms the bottom line.
Of course a UM professor (i.e., liberal) and a Democrat lawmaker would claim this is extortion, because they think money grows on trees or is freely handed out from leprechauns at the end of a rainbow. Whereas GM is just conducting good business within the current economics of CRE.
General motors in 2026 is going to race in Formula One. It’s going to cost them $450 million to join and a minimum of $300 million to race per year and they’re asking for help from the taxpayers.
In the year 2026 General Motors is going to start racing in Formula One. The cost of joining is $450 million and the cost of racing is $300 million And General Motors is asking the taxpayers for a handout no thanks