• May 9, 2008
One upside to a faltering real estate market is a plethora of good buys on property. General Motors took advantage of that fact by purchasing its Renaissance Center headquarters in Detroit for $626 million in cash. For another $200 million it picked up a couple of office buildings in Pontiac, too.
GM spokeswoman
Renee Rashid-Menem told The Associated Press that the company's lease was up for renewal on May 1, but they saw a good opportunity to get a deal on the place. She went on to say that as the real estate market improves, the company could sell the property and return to a lease arrangement.

Here's an interesting piece of trivia many outside the Detroit area may not know. Henry Ford II and Ford's real estate division built the Renaissance Center in 1977. General Motors claimed it as its HQ in 1996 and in 2005 completed a $500 million improvement project.

[Source: AP via Yahoo Finance]


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  • 21 Comments
      • 6 Years Ago
      wow born and raised in the D as well and did not know that.
      • 6 Years Ago
      Even though it costs money upfront, cheaper to buy than to rent long term.
      • 6 Years Ago
      Yet another "one-time charge" for GM...I'm sure we'll see this again also on their next quarterly report ("Excluding the one-time purchase of the RenCen, GM lost only...for the second quarter of 2008.)

      I love the spin we get from the Big 2.5 every quarter...they make everything sound like it's peaches and cream as the billion dollars losses pile up...these guys ought to run for public office...I hear Detroit is looking for a new Mayor.
      • 6 Years Ago
      I was amazed to learn that GM was renting the Renaissance Center and that they had only been there since 1996.

      I wonder what their deal is with the GM building in NYC?
      • 6 Years Ago
      "It's more fun watching a handful of people with 0 business experience take their personal opinions or things they have overheard, then apply them to how a company should run itself. Always entertaining."

      Yep.

      • 6 Years Ago
      Wow, $200 million on someone else's strikes, $826 million on real estate. GM should look around and find some other things to dump money into instead of product development. Because clearly their portfolio of large inefficient vehicles will serve them well in the coming years. After all, the new CAFE standards haven't kicked in yet and the gas tax holiday means people don't care about fuel prices any more. It's not like $1 billion invested in fuel efficiency R&D or competitive small cars would pay off later. Nope, GM should invest in Detroit real estate and solving American Axle's problems. It's not like they exist for the purpose of making cars or anything.

      I'll just jot this down in my notebook for later when GM files for bankruptcy or complains about CAFE at the 11th hour or asks for a bailout.
        • 6 Years Ago
        Kevin wrote: "... After all, the new CAFE standards haven't kicked in yet and the gas tax holiday means people don't care about fuel prices any more. ..."

        The gas tax holiday is a bad trial balloon that Presidential Candidate Senator John McCain (R, AZ) tried to float and Presidential Candidate Senator Hillary R. Clinton (D, NY) tried to carry. The trial balloon is made of lead. However, fuel prices are made of helium. They continue to rise.
      • 6 Years Ago
      July 1 2008
      GM reports quarterly earnings.
      loses 7.2 billion dollars.

      Top 5 execs get 17% increase in base salary.

      GM lay's off 19500 workers in 5 plants.

      LOL.
        • 6 Years Ago
        The 7.2 billion was mostly write-downs. Their operating financials were actually okay and definitely better than they were a few years back.
      • 6 Years Ago
      "Here's an interesting piece of trivia many outside the Detroit area may not know."

      I was born and raised in the Detroit area (I-94 and Chalmers) and I didn't know that. I bet that'll save them loads of money on rent in the long run!
        • 6 Years Ago
        Reminds me of the OCP building in ROBOCOP.

        Nice to have a building you can work at in the nations crime capital.
        • 6 Years Ago
        I was too very surprised that they were renting!
        http://www.azautophile.com
      • 6 Years Ago
      It's more fun watching a handful of people with 0 business experience take their personal opinions or things they have overheard, then apply them to how a company should run itself. Always entertaining.
      Jvijil
      • 6 Years Ago
      wow first $200 million for american axle then $850 million on properties.... GM must have A LOT of money stored up
        • 6 Years Ago
        @Jvijil
        You OBVIOUSLY have no idea how corporate finance operates. Even more obviously, GM did not finance this purchase with cash. Just shut up, they know what they are doing.
        • 6 Years Ago
        @Jvijil
        Not the same as the American Axel deal, its still in the books for $850 million.
        • 6 Years Ago
        @Jvijil
        And who would've thought FORD built the GM headquarters. Well well...and what a pretty building it is too. Kinda like the BMW head quarters , when you see it you know its BMW same's for this building.
        I wonder if ford ever thought they shouldn't have sold it!
      • 6 Years Ago
      If anyone ever visits Detroit or goes to the area for the Dream Cruise definintely check out Ford and GM headquarters if you get the chance. The RenCen has a lot of interesting exhibits, a university inside and a mall. Ford's HQ has the Henry Ford museum and historic village loaded with artifacts the man collected during his time, it's quite impressive.
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