Quicken Loans moving downtown

**detourdetroit** · July-13-09, 12:55 PM

while i'm delighted downtown will get a much needed boost of employees using the cbd, i'm also scratching my head a little. so 1,700 quicken folks are going into compuware? that's quite disturbing [[and telling). compuware's workforce at HQ must be pretty lean to absorb that number. this gives a sad testament to how undercapacity our downtown really is. WOW.

**Patrick** · July-13-09, 01:02 PM

More importantly, why are public funds being used at all to subsidize the poaching of a business from Livonia?

Very good point. When Warren tried to lure GM out of Detroit everyone yelled bloody murder. Now, when a business leaves the burbs for Detroit, it's a great thing, right?

**Novine** · July-13-09, 01:28 PM

"I remember doing research and remembering the exact same argument being made for train tracks through towns a hundred or hundred and twenty years ago. Would you be against trains? The location of the stop made or broke businesses and communities at that time."

It's not about being for or against trains or freeways or other forms of infrastructure. It's being against the phony argument of government favoritism or government spending in one situation and not in another. Government puts its thumb on the scales all of the time. Only in some cases, we're outraged and in others, we act as if it's not even happening.

**detourdetroit** · July-13-09, 01:33 PM

patrick. yes, that's right. it's due to a karmic, original sin kind of thing. if all of our politicians' pandering to god really did inspire positive action, [[s)he'd take a giant croupier's rake and do this kind of thing on a massive, multifaceted scale.

**iheartthed** · July-13-09, 01:38 PM

Originally Posted by digitalvision

As to pay cut - they've got a job. Deal. Every time someone new comes to the city people say "Oh I'm not taking the cut" or whatever, and what happens? Jack. It's all indignant bluster.

Right. Metro Detroit has the highest unemployment rate in the country right now. Anybody complaining about having to pay for parking should just quit and let someone else have the job.

I'm no sprawl fan, but for fun, I'll go down your rabbit hole, Novine ;-)

Freeways are for general consumption. I "benefit" regardless of which city I live in. If I need to go to Port Huron from Detroit, I-94 benefits me very directly. A mass transit line from Pontiac to Detroit would also benefit me very directly, but also everyone along the line.

The government is paying for something that everyone shares and can benefit from. When the government subsidizes businesses like this, it's picking winners and losers, which is contrary to a free market economy. Government should provide infrastructure, but directly picking winners and losers I do not agree with.

On the other hand, it can be argued that a consolidated central business district in downtown Detroit can give metropolitan Detroit a more attractive image.

**Detroit500** · July-13-09, 02:37 PM

DetNews.com has this update:

Quicken still intends to build its own building downtown, but Cullen would not give a timeline. The delay in building something new has more to do with the commercial real estate market that still makes it difficult to finance the construction of new buildings.

http://www.detnews.com/article/20090...7130402/-1/rss

So apparently, the Mortgage Broker couldn't get a loan?

Retroit · July-13-09, 03:08 PM

Originally Posted by Detroit500

So apparently, the Mortgage Broker couldn't get a loan?

Hehehe! Yeah, I guess sub-prime mortgages don't make good collateral.

I agree 100% with bailey. I think Gilbert is trying to milk the system for all it's worth. I suspect that the semi-move downtown is to establish his Detroitness, so he can finagle a bigger deal.

[[Sorry for the cynicism. Just can't trust anyone that was complicit in the sub-prime mortgage debacle.)

**Mackinaw** · July-13-09, 11:59 PM

1700 people on four floors? seems a bit tight...

MIRepublic · July-14-09, 12:00 AM

I love all of this bitching about 'reverse poaching'. The complaint is really nothing more than asking why should we even have downtowns and central business distrcits, which is just a plain ridiculous question.

**bailey** · July-14-09, 08:25 AM

Originally Posted by MIRepublic

I love all of this bitching about 'reverse poaching'. The complaint is really nothing more than asking why should we even have downtowns and central business distrcits, which is just a plain ridiculous question.

No that is not the question. The question is why are state tax dollars being used to move a tiny fraction of one business from leased space in a suburb to leased space in Detroit? how does this make any buisiness sense at all? What is to be gained for anyone by using public funds for what is admitted to be a temporary move? Why does Quicken need a subsidy to make this move? And if we are throwing subsidies around for leased spaces, what happens if the next time the MEDC wants to subsidize something, its to move 2000 people from Detroit to Grand Rapids?

If Detroit itself wants to incentivize the hell out this, I could not care less. Detroit, Warren, Livonia.. can do whatever they want with thier respectivel tax burdens to lure [[or poach) buisiness investment. But, Livonia can't compete against the MEDC. The problem is that it's the MEDC getting involved with the active divestment in one community for another. It's just funny that no one bats an eye when the state picks Detroit as beneficiary, but those same folks will spend hours ranting if Warren wants to lure business there by giving tax breaks.

DetroitDad · July-15-09, 02:02 AM

Originally Posted by digitalvision

You don't have disagreement from me - I hate incentives, but they're the way of the world. You know, years ago, there were Federal incentives to make people live farther away from where they worked. The government has always done this crap, republicans, democrats, doesn't matter it just the dollars go with whomever's in power's agenda.

I personally support walkable, sustainable communities wherever they may be.

However, once I realized just how much of downtown is propped up with government money, I was shocked.

Literally, there's very few new projects in the past years that don't have DDA/government loans, or state/federal incentives. That's a warning sign that without government help, development downtown is not sustainable as a free market thing, unless you get Keffalinos-esque places, which is what the market can actually support financially.

The problem is that Detroit not being sustainable as a free market is coming to mean that Michigan is not sustainable as a free market. Too many young people are just up and leaving Michigan because they want to live and work in an urban environment that Michigan has yet to provide. I honestly wonder if Michigan leaders know what else to do, since their only other option may be to wait for Detroit to run itself into the ground, and by then it might be too late.

DetroitDad · July-15-09, 08:00 PM

By the way, with Quicken moving to Compuware, I wonder what exactly is going on over at the United Artist Building.

MIRepublic · July-15-09, 09:13 PM

Originally Posted by DetroitDad

By the way, with Quicken moving to Compuware, I wonder what exactly is going on over at the United Artist Building.

Funny, I was actually pondering something very similar, this morning. I'm wondering if Quicken still has development rights for the Hudson and Statler blocks, or if they'd been allowed to expire? There was a big deal made of development rights, but when the time came for them to expire, absolutely nothing was reported on, and that was months back. So, we don't know if they got an extension or not. In fact, I wrote one of the Freep journalist, today, to see if they could find this out.

**Paris_of_the_Midwest** · July-15-09, 09:33 PM

Originally Posted by bailey

No that is not the question. The question is why are state tax dollars being used to move a tiny fraction of one business from leased space in a suburb to leased space in Detroit? how does this make any buisiness sense at all? What is to be gained for anyone by using public funds for what is admitted to be a temporary move? Why does Quicken need a subsidy to make this move? And if we are throwing subsidies around for leased spaces, what happens if the next time the MEDC wants to subsidize something, its to move 2000 people from Detroit to Grand Rapids?

If Detroit itself wants to incentivize the hell out this, I could not care less. Detroit, Warren, Livonia.. can do whatever they want with thier respectivel tax burdens to lure [[or poach) buisiness investment. But, Livonia can't compete against the MEDC. The problem is that it's the MEDC getting involved with the active divestment in one community for another. It's just funny that no one bats an eye when the state picks Detroit as beneficiary, but those same folks will spend hours ranting if Warren wants to lure business there by giving tax breaks.

OK. No one likes incentives but I'm surprised these aren't the type of incentives people at DYes would actually agree with. I say that because this is the State of Michigan finally recognizing that a stable and growing Detroit is essential for the entire region and State. Therefore, first priority should be to attract businesses from other states to downtown Detroit [[not happening or happening at a very small scale) and second, the state should encourage in-state businesses to be in downtown. Note, it's not that I personally support this move but that I would think some on the DYES board would appreciate the state supporting Detroit.

Yes, this is just shuffling the deck chairs but it's shuffling the chairs to a place that makes more sense for them. It's moving the chairs from a place where it doesn't really help the region if they exist to a place where it does help the region. Obviously in the long term we want indigenous and growth in out-of-state businesses to grow our downtown but in the immediate future this seems to make sense. I can see a perfectly logical person saying they would not support the state offering credits for businesses to move to Oakland County from Detroit [[because it doesn't help the region) while saying that they do support credits that enable the strengthening of our downtown city center by moving suburban businesses downtown.

**Paris_of_the_Midwest** · July-15-09, 09:52 PM

Originally Posted by DetroitDad

The problem is that Detroit not being sustainable as a free market is coming to mean that Michigan is not sustainable as a free market. Too many young people are just up and leaving Michigan because they want to live and work in an urban environment that Michigan has yet to provide. I honestly wonder if Michigan leaders know what else to do, since their only other option may be to wait for Detroit to run itself into the ground, and by then it might be too late.

Exactly. And that's why in the long-run, these incentives might not be such a bad thing. At least they are contributing to building a viable urban center in the state [[a goal that was not advanced by Quicken being in the 'burbs).

**Novine** · July-15-09, 10:25 PM

"It's moving the chairs from a place where it doesn't really help the region if they exist to a place where it does help the region."

There's no benefit to the region from jobs in Livonia? That seems like a stretch. Do we say the same about Dearborn? Or Troy?

**Paris_of_the_Midwest** · July-15-09, 11:02 PM

It's not that there is no benefit to having the jobs in Livonia but that there is more benefit to having a major corporation HQ'd downtown. Quicken does more for the region being headquartered downtown than it does in Livonia. Furthermore, this helps Quicken get its "foot in the door" so to speak on being in downtown Detroit. Had this not happened now, who could say for sure if they would ever make the move. Once they're here in the city it will be easier to convince them to stay and expand.

**Novine** · July-15-09, 11:26 PM

"Quicken does more for the region being headquartered downtown than it does in Livonia."

I would like to see the numbers that back this up. I suspect that Quicken is getting significant tax breaks to move into Detroit. I don't think that was the case in Livonia. Quicken also, as far as I know, was paying significant amounts of property taxes to the state and county in addition to the City of Livonia. That won't be true in Detroit. I agree 100% with the goal of having a healthy and vibrant downtown Detroit. But the truth may be that Quicken contributed more in their current location than they will be located downtown, even with the positive spin-off that may come from that.

**MotownSpartan** · July-16-09, 12:43 AM

For a forum called DetroitYes! people sure are pretty negative. I think people in this region just love to complain. Even when something good happens in the city there is a negative spin on it. This doesn't mean we shouldn't debate the relative merits of offering in-state businesses tax incentives to relocate within the state but for once, maybe people could just be happy that our downtown has 1700 new jobs in the midst of this huge national economic crisis.

Also, don't forget that it wasn't just Livonia vs. Detroit, without the tax breaks from the state Quicken could've moved to Cleveland or some other locale.

**Novine** · July-16-09, 07:51 AM

No offense to the fine people at Quicken but I don't see the justification for state tax dollars here. These kinds of jobs don't have a huge economic impact like an advanced battery manufacturer or are a game changer like a Google or something similar. Before the response about 1700 jobs starts, there are a lot of companies in SE Michigan who are employing that many or more people. Do we give them all tax breaks? Or do we do less tax breaks and focus on getting taxes lower for everyone?

**jt1** · July-16-09, 08:17 AM

Novine - I agree and disagree.

I agree that tax dollars should not be used to support a move from one city in the state to another.

I however think that this may be part of the stroy. The other part being that Quicken very well may have forced the state's hand by threatening to move if credits were not used to retain them. The local paper's certainly are not known for their complete and thorough reporting. It would be the same as saying the State paid $700 MM to GM to retain the plants in Orion and Pontiac when they weren't necessarily moving or shutting down production in the first place.

The game of threatening to take production/jobs out of state to drive up a bidding war is extremely broken. It doesn't mean that Quicken didn't play it perfectly to get the state to pay for their move.

**MattB** · July-16-09, 10:26 AM

To respond to an earlier post, employees will be receiving a pay raise to make up for having to pay the Detroit city tax. They are also receiving free parking at Compuware, and will be able to take advantage of that for downtown events.

**bailey** · July-16-09, 10:32 AM

It's not that there is no benefit to having the jobs in Livonia but that there is more benefit to having a major corporation HQ'd downtown

Is some leased surplus space housing some of your employees in someone else's HQ really going to considered Quicken's HQ? Is Dan Gilbert's office moving?

**Mackinaw** · July-16-09, 10:02 PM

I'd rather have state funds pay for a better central city than for half of what their existing spending goes to. Yeah, I know, there's something no-so-kosher about corporate welfare, obviously, but if we look at this as a straight-up incentive striving towards the normative goal of a stronger central city, then it's less offensive. After decades of road and infrastructure building that effectively subsidized new suburban development in two counties [[Oakland and Macomb), Detroit is more than due to see some development-inducing spending. Hell, is the state even subsidizing the Woodward Light Rail. Correct me if I'm wrong, but I don't think they are [[or it's negligible). In other states, state funding for major transit is the standard. Detroit is owed a lot.

**Gistok** · July-16-09, 11:41 PM

Originally Posted by Mackinaw

I'd rather have state funds pay for a better central city than for half of what their existing spending goes to. Yeah, I know, there's something no-so-kosher about corporate welfare, obviously, but if we look at this as a straight-up incentive striving towards the normative goal of a stronger central city, then it's less offensive. After decades of road and infrastructure building that effectively subsidized new suburban development in two counties [[Oakland and Macomb), Detroit is more than due to see some development-inducing spending. Hell, is the state even subsidizing the Woodward Light Rail. Correct me if I'm wrong, but I don't think they are [[or it's negligible). In other states, state funding for major transit is the standard. Detroit is owed a lot.

... don't forget western Wayne County!

The city itself is as much to blame for subsidizing new developments... after all the city owned water department followed the expansion of roads, electrical and gas...