GM says open to moving from Detroit headquarters

**Gistok** · May-12-09, 02:17 AM

OK... the "audacity" of Warren mayor Fouts may be more of an act of desperation, rather than a slap at Detroit....

The 33+ square miles that make up Warren are split into 2 parts [[via Centerline)... the lower half is seedy and more industrial... the upper half is much nicer housing stock, and some really nice business addresses.

Well Warren is going to be especially hard hit by a shrunken USA auto industry. Just look at the miles of Tool & Die shops in Warren along 9 & 10 Mile roads, Mound Rd., Groesbeck Hwy., Sherwood St., Bunert St., etc... Warren is laden with Tool & Die shops that... besides the auto plants [[along Mound) and GM Tech Center... are really feeling the pinch.

Although many of metro Detroit's cities have Tool & Die shops, there is a heavy concentration of them in Warren, Sterling Heights and Roseville. Plus Warren & Sterling Heights each have several auto plants.

So Jim Fouts announcement to seek the GM HQ relocation, is more a sign of the desparate times that the city of Warren is going to be in, rather than an affront and insult to Detroit.

It may be especially lean times ahead for Warren city government....

MIRepublic · May-12-09, 03:19 AM

Why do the two have to be mutually exclusive? This can both be Warren in serious need of more employment, and still be the cannibalisation of Detroit. I'm not sure what Warren's wants/needs make this anything less than the cannibalisation of Detroit.

Better Warren than out of state, but it'd only be appropriate to be making this gestures if it became clear that GM was potentially on the move. Anytime before than moment, and it's grossly premature and it really looks bad for the region and the initiator of the plan. In this case, I think Fouts comes out of this looking more foolish than any other party in all of this, and to jump the gun makes the metro look bad because it reveals and/or encourages the tawdry, impatient [[and destructive) suburban provincialism that's become so characteristic of the metro, one that doesn't even have the decency to give the central city first dibs at negotiating with one of its major corporations if that turned out to be the case.

**Roq** · May-12-09, 04:10 AM

Originally Posted by detmsp

What should be a factor in the decision would be future cash flows. How much does it cost to operate the Ren Cen? How much additional operating costs would be incurred by moving people to Warren? What's the one time revenue from selling the Ren Cen? What is the one time cost of moving to Warren?

Now, quit being rational and logical...you'll confuse everybody.

**Moetown** · May-12-09, 04:28 AM

Warren and sterling heights have been giving out big tax breaks and everything else they can to get new business's to relocate for many years, nothing new.
The main difference is warren now has a real aggressive, camera hugging fool for a mayor. Tv has realized that if they can get a camera near his mug, they will have a story..

Angry Dad · May-12-09, 04:52 AM

GM doesn't have to build anything in Warren if that's where they would go.

There's more than enough space there sitting empty.

They would need a tax break to use what they already have?

They can't sell parts of the Tech Center.

They can sell or lease the Ren Cen.

**R8RBOB** · May-12-09, 08:01 AM

After reading about this in the News, I realized this is nothing but pie in the sky.

First off, General Motors need not move to Warren, they are already there. I could understand if Warren didn't have the Tech Center and they went to GM offering free land, tax breaks and bells and whistles to relocate but Warren can't offer GM because they already have the property.

As I previously posted, Fouts is attempting to help his city which I don't fault him for but at Detroit's expense. From today's News story:

Warren -- Times are tough and as her sales continue to slide, bar owner Beverly Suida is praying for a miracle.

City officials say Suida could get the break she's been waiting for if General Motors executives respond to their invitation to move GM headquarters from downtown Detroit to the company's Technical Center in Warren.

It's an invitation Mayor Jim Fouts says he will formally extend this week.

"It would guarantee Warren should survive through all this. It'll be one of the cities that'll make it," said Suida, who owns Victory Inn Bar & Grill that's about a half-block from the Technical Center.

"The Tech Center is the bulk of my business. I need them to stay alive. Everyone [[around here) does. Hopefully, this will bring all the work back here."

gravitymachine · May-12-09, 08:05 AM

oh the hand wringing!!

...and all because GM didn't say that they wouldn't consider possibly moving.

**artds** · May-12-09, 08:52 AM

Originally Posted by R8RBOB

Do you really think General Motors is going walk away from 500,000,000 dollars of glass and steel?

Some folks really believe that GM can just pack up and leave. GM does not have a lease to break. The Ren Cen is theirs and they are not walking away from the Riverfront for a patch of land in Macomb Country.

How much equity do they have in the building?

What's to prevent GM from just leaving and forcing the lenders who financed their acquisition of the RenCen to foreclose while GM hides behind the protection of a Bankruptcy filing?

**R8RBOB** · May-12-09, 09:16 AM

Originally Posted by artds

How much equity do they have in the building?

What's to prevent GM from just leaving and forcing the lenders who financed their acquisition of the RenCen to foreclose while GM hides behind the protection of a Bankruptcy filing?

Thanks for the morning laugh....foreclosure on the Renaissance Center. GM would really be down to its last dollar.

**artds** · May-12-09, 09:54 AM

Originally Posted by R8RBOB

Thanks for the morning laugh....foreclosure on the Renaissance Center. GM would really be down to its last dollar.

I don't know what "down to its last dollar" has to do with anything or why you felt it was necessary to use a rude tone.

Your whole argument was that GM can't walk away from the RenCen since they own it and don't have a lease to break.

But if there were lenders involved in GM's acquisition of the RenCen, then its possible that GM only has a small amount of equity in the RenCen that it would be walking away from. Normally in that situtation, the borrow still has to honor its obligations to the lender even after the lender forcloses, but when a company files for bankruptcy protection, it wipes or or greatly reduces their outstanding liabilities.

Foreclosures of commercial properties in Detroit aren't even that rare. Comerica Tower aka One Detroit Center was in foreclosure back in 2007 when its former owner, Hines, couldn't honor its debt obligations to its lender, iStar financial, so iStar foreclosed and took over control of the property.

**iheartthed** · May-12-09, 10:24 AM

I wonder if the question is better asked: Does GM even still have the option to stay in the Ren Cen if they go into bankruptcy? Since they mortgaged the property to stay afloat, the lender who gave them the money will likely be one of those creditors with who they will be renegotiating in a bankruptcy...

**jiminnm** · May-12-09, 10:33 AM

Originally Posted by artds

Normally in that situtation, the borrow still has to honor its obligations to the lender even after the lender forcloses, but when a company files for bankruptcy protection, it wipes or or greatly reduces their outstanding liabilities.

Not exactly, artds. Most [[if not all) commercial real estate loans are non-recourse. That means a lender's sole recourse for a borrower's failure to repay the loan is to foreclose on the building. If the building is worth less than than the loan balance, the lender is out the difference.

Your other point is correct. A bankruptcy judge could easily determine that the 'new' GM didn't need the RenCen. Depending on the difference between what the value is currently to the balance owed, what GM's equity is and whether loans on the RenCen are secured, the judge might order that the RenCen simply revert to the lender, or be sold and the proceeds distributed to creditors, or the lender be required to pay some amount to get the facility back.

**R8RBOB** · May-12-09, 11:26 AM

Originally Posted by artds

I don't know what "down to its last dollar" has to do with anything or why you felt it was necessary to use a rude tone.

Your whole argument was that GM can't walk away from the RenCen since they own it and don't have a lease to break.

But if there were lenders involved in GM's acquisition of the RenCen, then its possible that GM only has a small amount of equity in the RenCen that it would be walking away from. Normally in that situtation, the borrow still has to honor its obligations to the lender even after the lender forcloses, but when a company files for bankruptcy protection, it wipes or or greatly reduces their outstanding liabilities.

Foreclosures of commercial properties in Detroit aren't even that rare. Comerica Tower aka One Detroit Center was in foreclosure back in 2007 when its former owner, Hines, couldn't honor its debt obligations to its lender, iStar financial, so iStar foreclosed and took over control of the property.

artds, no disrespect. I wasn't attempting to be rude with you.

Ok, the Ren Cen.....what you said, I don't have any disagreement with. GM could give the middle finger to its lenders and just walk away but we know that isn't the plan. The plan is....for GM to let those who deal with GM know that they are going through some hard times and they need some help.

Remember when Comerica announced they were moving their headquarters to Dallas? There was no postering in the media on if they will move. The region woke up one day to find out they were leaving the state catching the mayor and governor off-guard because they were not aware they were thinking about moving. This is because the heads at Comerica had their minds made up to move and they did not want Kwame Kilpatrick or Jennifer Granholm trying to change their minds.

If Fritz Henderson and the board wanted to leave Detroit for Warren or parts unknown, the decision would have already been made and there would be nothing that Dave Bing or Jennifer Granholm could do about it. Henderson is attempt to "light a fire" by having the press report that they would leave Detroit [[This happened last week with Bishop movitating the City Council to get the Cobo deal done) Now the mayor can sorta agree to get GM some tax relief while they are going through these rough times.

I think we are going to far with this story but this want Henderson wants. To have people up in arms about GM "desire" to flee the "crime-infested, dirty city for the safe and clean city.

**Lloyd** · May-12-09, 11:30 AM

Originally Posted by President Sekou

If GM leaves, they can take there goddamn Pontiac that I drive with them. Then I swear I will buy strictly foreign for the rest of my life and I will convince everyone I know to do so as well. And if those socialist force the move then well hello Republican party.

What planet are you from? Buying strickly foreign will only help our country go down the toilet faster. As far as your ignorant socialist comment... what don't you like about the Obama bailout?... the fact that it didn't give hundreds of millions to the already rich with no accounting or accountability <like the Bush bailout>?

**Danny** · May-13-09, 07:39 AM

General Motors just can't simply compete in tthe global automobile market. It's losing money and running out of options and ideals. Leaving their Ren Cen building to Warren would be the final solution in order GM to be saved. General Motors is too big to fail. But shutting down GM would be ecomomic collapse not only to Detroit and suburbs, but also the U.S. You can thank former president George " retarded" Bush for the rediculous global trade policies and the neo-con goon squads for making it possible.

General Motors screw FLINT by moving its world headquarters to Detroit and now GM is screwing Detroit by moving to Warren. What's next? screw Warren and move to Sterling Hieghts.

**detmsp** · May-13-09, 08:37 AM

Originally Posted by R8RBOB

Henderson is attempt to "light a fire" by having the press report that they would leave Detroit [[This happened last week with Bishop movitating the City Council to get the Cobo deal done) Now the mayor can sorta agree to get GM some tax relief while they are going through these rough times.

I think we are going to far with this story but this want Henderson wants. To have people up in arms about GM "desire" to flee the "crime-infested, dirty city for the safe and clean city.

Are you suggesting that this is some sort of conspiracy by GM? That Henderson planted a journalist to ask him that question? Get real. He was asked the question by a reporter and he just said we're not planning to, but never say never.

ask your boss if your company will have any layoffs this year... you'll probably get a similar answer

**oladub** · May-13-09, 09:14 AM

It will matter less where GM chooses to locate its headquarters in the neat future. GM has just announced that it will begin importing Chinese manufactured cars beginning in 2011. The paperwork for that can be done anywhere. "Opting to export from China would help the company, now surviving on $15.4 billion in federal loans, to slash production costs and make full use of its huge investments in factories here." http://news.moneycentral.msn.com/pro...513&id=9798983

Since the federal government now has a stake in GM [[Government Motors) and has even replaced its CEO with its own approved CEO, it is an interesting move for GM to begin importing Chinese cars. It doesn't do much to relieve unemployment but will it curry enough favor with the Chinese government to get it to resume buying US Treasuries to finance our Stimulus Program to put Americans back to work?

**bobby wobby** · May-13-09, 09:21 AM

If cost and bottom line was all that mattered ,Manhattan ,the highest real estate and taxes in America ,would be a ghost town, GM needs the RenCen its a lot better location then that 50 yr old suburban mall in Warren thats half vacant,I say move the tech center downtown,.They would be close to WSU and CCS connected soon by a rail line. Whats on 14 mile road?

**bobby wobby** · May-13-09, 09:25 AM

If cost and bottom line was all that mattered Manhattan ,the highest real estate prices in the world, would be a ghost town,

**otter** · May-13-09, 11:46 AM

Danny,

GM never had its headquarters in Flint, though Harlowe Curtice might have wanted it to be. When each division was independent, before they were consolidated in the early 80s or so, Buick was always based in Flint, however.

O.

**iheartthed** · May-13-09, 12:10 PM

Originally Posted by otter

Danny,

GM never had its headquarters in Flint, though Harlowe Curtice might have wanted it to be. When each division was independent, before they were consolidated in the early 80s or so, Buick was always based in Flint, however.

O.

I thought it was founded in Flint?

**otter** · May-13-09, 04:02 PM

Heart,

A while after I posted that, something was triggered in my memory telling me they may have been based there when they were founded. Not sure - you may be right. My recollection didn't go back past whenever their building on W. Grand was built.

O.

**DTWflyer** · May-17-09, 08:47 AM

Fouts was on Ch.7's Spotlight on the News this morning tooting his own horn about "his" proposal for GM to move to Warren.

Who does this guy thing he is? He went on the show, acting like he knows everything about GM's inner workings, and saying it is absolutely in GM's best interest to move to Warren for the company to survive. He kept going on and on that is is best for them in the future and he will have his proposal ready within a week and that the US Government is going to go along with it because it makes financial sense for the company.

Chuck Stokes started prodding him about his opinion of Bing, the City of Detroit, and regionalism. Fouts said that he says regionalism means we should worry about whether companies move within the region, but that they need to stay in business. He said we should get concerned about borders, its all to help the companies. Then he said, "Well, Bing will understand, he's a businessman. Although my job of getting GM to move to Warren just got a lot harder with him getting elected to office."

Fouts also let it slip that over 50% of his tax revenue comes from GM, Ford, and Chrysler.

Then he said he wasn't invited to the Mackinac conference because there some powerful leaders in the State that are strongly opposed to his plan to move GM to Warren, and they are not happy with him. Fouts said there is no way he is backing now on his "proposal to save GM."

This guy loves to hear himself speak and is a windbag. He only has Warren on his mind and that is it. We don't need a guy like this in our region.

**313WX** · May-17-09, 08:54 AM

Originally Posted by DTWflyer

This guy loves to hear himself speak and is a windbag. He only has Warren on his mind and that is it. We don't need a guy like this in our region.

Ah yes, just like L. Brooks Patterson & Oakland County.

Simply substitue "Patterson" for "Fouts" and "Oakland County" for "Warren".

**313WX** · May-17-09, 09:04 AM

Originally Posted by bobby wobby

If cost and bottom line was all that mattered ,Manhattan ,the highest real estate and taxes in America ,would be a ghost town, GM needs the RenCen its a lot better location then that 50 yr old suburban mall in Warren thats half vacant,I say move the tech center downtown,.They would be close to WSU and CCS connected soon by a rail line. Whats on 14 mile road?

Uh, the GM Tech Center is on 12 Mile and Van Dyke...

One thing they have that the Detroit HQ doesn't is a Meijer directly across the street.