Harnessing Regional Wealth: Companies That Could Move to Detroit

[Mackinaw]

In the spirit of other good threads about what we'd like the downtown of 2020 to look like, and what sort of new small businesses are in demand in the city, I wanted to simply list some major employers located outside the City of Detroit who should be targeted for a move to the central city. Some may be more inclined than others. Some may have solid reasons for having a suburban campus, based on what they do. But I feel strongly that many can and should move to the central city, and that such a move-- as with Quicken and Compuware-- grows the pie and changes the growth vectors and perception of the city [[it would be nice to boast of having over 10 Fortune 500s in the city) and the region. It goes without saying that each such move would heat up the city's housing market, increase central city population, spur retail development, and increase transit usage/demand [[including regional transit). Dan Gilbert has allegedly attracted at least a few other businesses, and he reportedly constantly lobbies others in his local rotary club, so to speak, to come on down. Well, here are some more he can go after, and all of us too, using our collective, if small, influence:

Penske Automotive Group- #194 on Fortune500. Bloomfield Hills. The boss seems invested in changing the city…but his corporate HQ is a missing piece in the equation.
TRW Automotive- #165 on Fortune 500. Livonia.
Kelly Services- #468 on Fortune 500. Troy.
Lear- #177 on Fortune500. Southfield.
Masco Corp- #323 on Fortune 500. Taylor.
Visteon- #351 on Fortune 500. Van Buren Twp.
BorgWarner- #352 on Fortune 500. Auburn Hills.
The Detroit Pistons Basketball Club- Auburn Hills [[previously Detroit-based).
Chrysler Group LLC- Auburn Hills [[U.S. HQ)…has opened a small space in Dime Bldg.
Flagstar Bank- Troy.
Meadowbrook Insuance Group- Southfield. Largest business insurer based in MI.

And then there is this company called Ford.

Thoughts? Additions? Seems to me that many of these companies have impediments, such as owning their 'house' and likely not being able to find a buyer, like Chrysler or the Pistons. Others, who lease, should have more flexibility. Any insight as to which of these companies leases, or owns property that could be easily sold, would help.

[Hermod]

Well, if your employees bought houses within a convenient [[or slightly less convenient) commute to your location, many of them would be real unhappy to find they would have to schlepp into downtown Detroit every day. Some companies value their employees more than others do and would take their wishes into account.

[renf]

Taxes have some influence. Detroit is one of only 21 cities in the state with a city income tax. And it has the highest city income. The state might switch to one property tax rate for all properties in the state including those owned by non-profits. Then the city income taxes might be removed. We made some start on revising the state's tax system in Tuesday's election. Let's move toward a fixed property tax rate for all properties in Michigan and remove some of the local taxes including the income tax and Detroit's utility tax.

[Hypestyles]

I wouldn't mind if they all moved into the city-- especially if they were spread out and not just downtown. This is why it's important for a proper land survey to be taken to identify all the far-gone blighted structures, so they can be torn down. Then city planners would have a better handle on what areas could be re-zoned and promoted to investors to possibly create a business campus.

[Scottathew]

It would help to slow sprawl. All of a sudden that house in Independence Township isn't looking so good now that you work in Downtown Detroit instead of Auburn Hills\Troy\etc...

[313WX]

And then there is this company called Ford.

Technically, it's called Ford Motor Company.

But in any event, FoMoCo and the Ford family are too heavily invested in Dearborn [[see the Fairlane estate). Keep in mind they [[relatively recently) moved their offices that were downtown into a new-ish building in Dearborn. They're not relocating anywhere.

[313WX]

Well, if your employees bought houses within a convenient [[or slightly less convenient) commute to your location, many of them would be real unhappy to find they would have to schlepp into downtown Detroit every day. Some companies value their employees more than others do and would take their wishes into account.

Good point.

The vast majority of the employees at these companies live in exurban communities where a commute into downtown would be very inconvenient, and given the state of Detroit's neighborhoods and now the decline of many inner ring suburban communities, many of them probably wouldn't want to move closer to work IF their companies moved downtown.

[Wings]

I think the most likely to move downtown is definitely Penkse, then maybe TRW or Borg Warner. I welcome any new corporate entity if it means more jobs in Detroit. The nationwide shift is for companies to be headquartered in a large urban area, so I believe we will see a few of these move downtown in the future. It takes a while to move large companies, so it may not happen for 10-15 years.

I don't see Ford or Chrysler moving downtown any time soon. As much as I would love to see Ford pull a GM and build a new 50-story office building on the Hudson site, I doubt it will happen for a long time. Ford will have a tough time selling their old, dated, monolith of a HQ to anyone, considering it's meant to hold a Ford-sized company [[and what Ford-sized company is willing to move to Dearborn nowadays?). Chrysler's shopping mall-esque HQ is also too big and inconveniently located to attract any serious buyers, so they will be stuck in Auburn Hills for the foreseeable future.

[Scottathew]

Technically, it's called Ford Motor Company.

I thought it was called Ford's.

[Hermod]

I thought it was called Ford's.

Like "Federal's Dept Store".

[iheartthed]

I don't really see why an auto supplier would move to downtown Detroit. Of that list I think Penske, Kelly Services, Flagstar and Meadowbrook would be the most likely candidates for a dmove to the city. It would be nice for Detroit to have a bank headquartered downtown again.

[313WX]

I don't really see why an auto supplier would move to downtown Detroit.

Before filing for bankruptcy, Visteon intended to move some offices into One Kennedy Square.

[FormerDetroiter]

Like "Federal's Dept Store".

And Kmart's.

[1953]

I like this new plan to move all major companies into Detroit. You have my full support.

[jiminnm]

The first 7 on your list have been where they are for quite some time, and it seems to have owned out nicely for them. They will need a very good corporate reason to leave where they are now, as well as a very good reason to choose the city for a new location.

[Lowell]

Taxes have some influence. Detroit is one of only 21 cities in the state with a city income tax. And it has the highest city income. The state might switch to one property tax rate for all properties in the state including those owned by non-profits. Then the city income taxes might be removed. We made some start on revising the state's tax system in Tuesday's election. Let's move toward a fixed property tax rate for all properties in Michigan and remove some of the local taxes including the income tax and Detroit's utility tax.

Well put. In a similar vein, I would like to see insurance reform that would place SE Michigan under a single rate structure to eliminate the red-lined rates that punish CofD residents and businesses.

Those who choose to live in the City of Detroit 'pay' enough by dealing with crime issues and inferior services. It is unfair that they are also financially penalized because of them. It is well-known that those insurance rates also lead to 'bunking' to a avoid the higher rates by maintaining outside addresses thus depriving the City of revenue sharing and legislative clout.

[motz]

The first 7 on your list have been where they are for quite some time, and it seems to have owned out nicely for them. They will need a very good corporate reason to leave where they are now, as well as a very good reason to choose the city for a new location.

Minus the Pistons and Chrysler/Ford [[due to their huge respective campuses in the 'burbs), I think a fair amount of these businesses may be enticed to move into the city as they need to replace suburban-loving retiring employees with urban minded young professionals. The entire thing about younger people wanting to live in more urban areas is not a total myth, there is a very very healthy chunk that would prefer to live in a Ferndale or Midtown or Downtown or Royal Oak instead of a Troy or Auburn Hills or whatnot.

[JoeGeds]

McLaren in Livonia on 8 mile would be a good candidate. They employ over 100 engineer types and do testing and fabrication of drivetrain components. They are trying to expand by adding a few stories to their existing building, and building a parking ramp to accomodate more employees, but residents are fighting the re-zoning, and so far, city council is siding with residents. Hate to see another Livonia company say bye-bye [[like Rock Financial did), but if residents are fighting the expansion, they may have to move. Here's the article:
http://www.hometownlife.com/article/...moving-forward

[WSU12]

Hopefully Gilbert comes through and brings a couple of new companies to Detroit. Preferably startup technology companies.

[Honky Tonk]

I thought it was called Ford's.

That's Fordz, with a "Z".

[Mackinaw]

McLaren in Livonia on 8 mile would be a good candidate. They employ over 100 engineer types and do testing and fabrication of drivetrain components. They are trying to expand by adding a few stories to their existing building, and building a parking ramp to accomodate more employees, but residents are fighting the re-zoning, and so far, city council is siding with residents. Hate to see another Livonia company say bye-bye [[like Rock Financial did), but if residents are fighting the expansion, they may have to move. Here's the article:
http://www.hometownlife.com/article/...moving-forward

What absurd Nimbyism-- talk about biting the hand that feeds you. If you are a downtown building owner, you should be calling their execs to get them to call off their plans. I am sure Mike Duggan would join you on the call, too.

[bailey]

Minus the Pistons and Chrysler/Ford [[due to their huge respective campuses in the 'burbs),

Sure but with the Domestic 2 and what'll be left of Chrysler--- Both Ford and Chrylser maintain the HQ and R&D at one campus. GM NOT being in Warren is the strange one. Something I'm sort of surprised didn't happen during the bankruptcy. White elephants like the snazzy landmark HQs AND sprawling redundant office facilities 10 miles away usually don't both make it through. FWIW, allegedly the move from the RenCen was bandied about and then was quietly kiaboshed by higher authority because it would have been terrible optics. So, we should all thank ourselves as taxpayers for coughing up the dough to let GM keep its house AND cottage AND boat....

The entire thing about younger people wanting to live in more urban areas is not a total myth,

Agreed...which is why they move to places like Chicago. What is "myth" is that any company around here ...like a Kelly Services, has any reason to give a shit. When Kelly services DOESN't have 100 applications for ever job opening they're trying to staff, MAYBE they'll pick up their heads and wonder why... however, I don't see the answer EVER being, "well, it'd be really great if we had a downtown Detroit office building for this business".

We keep talking about the symptoms and not the disease. Detroit had all these places [[minus ford ...it's been in Dearborn forever) poached from it because they were either directly bribed to move to where they are or they followed clients and customers that were bribed to move out there. and by bribed I mean either through direct tax subsidy, or indirect subsidy in the form of cheap, new office/manufacturing space and cheap new houses, and "free" infrastructure.

Detroit isn't getting any of these companies back [[or any company at all) without luring them here with straight up cash on the table....or hoping a Billionaire owner [[Gilbert, Illitch..et al) is feeling charitable. And even with the charitable ones, it's apparently a tough sell. For example, I'm surprised Penske hasn't at LEAST moved the flag [[ala "Chrysler house") considering all his boosterism.

I know it's not feasible, because of detroit's legacy costs and it's bankrupt and it's a zero sum game of robbing peter to pay paul and the "free" infrastructure easily funded in the burbs is considered "wasted" on detroit...but it would be interesting to see what some serious LB Patterson type poaching could do. "Hi Masco? Yeah, it's Detroit here... Yeah, the city with the mansion your founder donated for the Mayors to live in as recognition for all DETROIT did for him...yup, still there. Crazy huh? So, you know how Ann Arbor gave you 10 million to set up your cabinets division out in BFE and move 350 jobs there? how's 500 million in both direct cash payment and infrastructure build out sound to relocate that division, along with the HQ up from Taylor...along with anything else you have lying around the metro area?

I mean shit, that's probably less than what Jones Day is going to make on the bankruptcy. /sarc

[iheartthed]

Sure but with the Domestic 2 and what'll be left of Chrysler--- Both Ford and Chrylser maintain the HQ and R&D at one campus. GM NOT being in Warren is the strange one. Something I'm sort of surprised didn't happen during the bankruptcy. White elephants like the snazzy landmark HQs AND sprawling redundant office facilities 10 miles away usually don't both make it through. FWIW, allegedly the move from the RenCen was bandied about and then was quietly kiaboshed by higher authority because it would have been terrible optics. So, we should all thank ourselves as taxpayers for coughing up the dough to let GM keep its house AND cottage AND boat....

GM floated the idea but the Obama administration nixed it because they believed it would not significantly cut costs. Like you said, it would've been very bad optics... and not much reward. Could you imagine how Detroit's bankruptcy narrative would look if GM had moved out of Detroit while being supported by federal dollars? The government showed a lot of good foresight in the decision, IMO.

[animatedmartian]

Not only that, but I really don't think Warren is set up to absorb a company the size of GM. 12 Mile, Van Dyke, Mound, and 696 are all a clusterfuck around rush hour on top of on going construction because of how shitty the roads are. Downtown Detroit is much better built to handle traffic exactly because it was designed to. The suburbs are pretty badly built at handling traffic. There needs to be a lot more freeways slicing up Oakland and Macomb County than there currently is.

Anyway, I'm actually more in favor of out-of-state companies locating in Detroit rather than local suburban ones. Just because a company moves from the suburbs downtown doesn't mean people will move with it. Most people don't even live in the same suburbs that they work in so it really wouldn't make that big of a difference resident-wise. Sure, a certain percentage of people will be more enticed into living in Detroit, but unless you're young, single, and already looking to live in a downtown/urban area, I wouldn't expect many workers to move. At least with out-of state companies, there's a better chance at having a fresh new population of residents rather than just shifting of the tri-county area.

[Gistok]

FWIW, allegedly the move from the RenCen was bandied about and then was quietly kiaboshed by higher authority because it would have been terrible optics. So, we should all thank ourselves as taxpayers for coughing up the dough to let GM keep its house AND cottage AND boat....

So how much do you think that will cost per capita across the entire country?? A dime, a quarter, 50 cents? When we look at the damage to the city that would have caused... it hardly seems worth mentioning, when spread out among the entire nation... unless your last name is Fouts!