Detroit — General Motors Co. will move its global headquarters to the Hudson’s Detroit development, while it works with billionaire mortgage mogul Dan Gilbert’s real estate firm to redevelop the Renaissance Center, its current home a mile away, three sources familiar with the situation told The Detroit News.
An announcement is expected to be made at a 4:30 p.m. news conference at the under-construction former J.L. Hudson’s department store site, which is expected to open this year.
The partnership, whose details weren’t immediately available, would represent a new era for Michigan’s tallest skyscraper amid raised questions over its future in the wake of the COVID-19 pandemic that disrupted workplace models and sent many to work remotely. Earlier this year, southeast Michigan and parts of central Michigan recently were ranked as the metropolitan area with the nation’s highest office vacancy rate at 25%.
Gilbert’s Bedrock LLC previously looked at purchasing the 47-year-old Renaissance Center. The real estate firm has snatched up a portfolio of properties along the Detroit Riverfront, citing visions for a space for “sustainable urban development.”
Last week at the Hudson’s site on Woodward, Bedrock and contractor Barton Malow held a topping-off ceremony, placing the final steel construction beam on the project’s 685.4-foot-tall tower. Bedrock broke ground on the project in 2017.
The two-building development will include 1.5 million square feet of office, retail, food, residential, hotel and event space. Bedrock plans to continue construction through the spring in a phased approach with crews installing the remaining elements of the glass façade.
GM is the latest example of a corporation making moves concerning its headquarters in the wake of the COVID-19 pandemic revolutionizing workplaces. Most GM employees are expected to be in the office three times a week, and it has moved a number of teams from the RenCen to its Warren Technical Center in recent years.
Crosstown rival Stellantis NV also has discussed selling its Auburn Hills headquarters in a leaseback agreement where it would remain in the Pentastar-topped tower and technical center off Interstate 75 as a tenant.
Troy’s staffing company Kelly Services Inc., Chicago’s Motorola Solutions Inc. and Cleveland’s Sherwin-Williams Co. all have said they’re selling off their headquarters and instead leasing space. It provides them a source of liquidity with employees working remotely or partially so.
Construction on the Renaissance Center began in 1973 under the vision of Henry Ford II in partnership with 26 other business leaders in an effort to encourage building activity in Detroit in the aftermath of the 1967 Detroit uprising. The $350 million project (roughly $1.7 billion today) was the country’s largest privately funded real estate development at the time. Upon opening in 1977, the center hotel tower was the largest in the world. Towers 500 and 600 were added in 1981, and a third phase that was supposed to include residential housing never came to fruition as Detroit’s population continued to decline.
GM bought the complex as its global headquarters in 1996 for $73 million (about $142 million today). It moved from Cadillac Place in the New Center district.
GM for a while has been looking to unload the more than 5.5 million-square-foot, seven-tower complex. Crain’s Detroit Business previously reported Gilbert’s Bedrock and GM had been in discussions in the fall of 2018 about a sale of the site; they fell apart because of costly renovations, including an overhaul of the heating, venting and air conditioning system.
The Renaissance Center, which sits on 14 acres, is a city within a city that features a Marriott International Inc. hotel as well as a People Mover stop.
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Barbara Terrio is a seasoned business journalist, delving into the world of finance, startups, and entrepreneurship. With a knack for demystifying complex economic trends, she helps readers navigate the business landscape. Outside of her reporting, Barbara is an advocate for financial literacy and enjoys mentoring aspiring entrepreneurs.
