General Motors is expected to announce Monday afternoon that it is relocating its global headquarters in downtown Detroit from the Renaissance Center on Detroit’s waterfront to Hudson’s Detroit building.
That is confirmed by a person familiar with the plan who insisted on anonymity because they are not authorized to speak publicly.
The Hudson’s site on Woodward Avenue is the new 1.5 million-square-foot development by Bedrock, the real estate firm of Dan Gilbert, chairman of mortgage lender Rocket Companies Inc. The project’s skyscraper topped out last week at just over 681 feet, making it the second-tallest building in Detroit, behind the central tower of the Renaissance Center.
More:Detroit’s RenCen history dates back to 1977: Key facts about GM’s downtown HQ
GM spokesman Kevin Kelly declined to comment on the expected news, as first reported by Bloomberg and the Associated Press earlier Monday.
GM CEO Mary Barra and Gilbert will hold a news conference at the building at 4:30 p.m. when they are expected to announce that GM will leave its space at the Renaissance Center office tower where it has had its headquarters since 1996. That’s when the automaker purchased five of the seven towers there for $73 million, according to the Detroit Historical Society. Farmington Hills-based Friedman Real Estate said it bought the RenCen’s 500 and 600 towers in December for an undisclosed price from a New Jersey utility company that had owned them for years.
The AP reported that GM and Gilbert plan to study how to redevelop GM’s RenCen headquarters, but the plan does not involve a sale of the RenCen. That was confirmed by the Free Press source familiar with the plan.
More:Hudson’s site skyscraper reaches full height, is Detroit’s 2nd tallest building
GM mandate was helping businesses at RenCen
The Hudson’s site consists of two side-by-side buildings: an 11- or 12-story “office block” with over 500,000 square feet of office, commercial and events space, and a 49-story skyscraper that is expected to house an ultraluxury Edition Hotel and about 100 condos and apartments. The Hudson’s site project broke ground in December 2017 and the buildings could be substantially completed by the end of this year.
Since the COVID-19 pandemic, the daily population of workers at the RenCen has been dwindling as many of GM’s employees, who once occupied the offices there, worked from home. Earlier this year, GM mandated its workers come in on Tuesday, Wednesday and Thursday of each week, which has helped boost foot traffic in the RenCen to help restaurants and other businesses that rely on office workers for daily business.
Steve Ali, owner of Salsarita’s Fresh Mexican Grill located in the RenCen’s food court on the lower level, said the reports Monday that GM planned to move from the RenCen was “a shock, to say the least.”
Last month, Ali and other restaurant owners in the food court told the Detroit Free Press that business had slowly started to pick up with GM’s mandate that people work from the office three times a week.
“I was hoping I’d see a gradual improvement over the year with the number of tenants in there,” Ali told the Free Press Monday. “I didn’t see this one coming. This doesn’t put us in a very good position. This is very shocking and disappointing. I am not sure where it’s going to leave us — even if they redevelop it, it will be a very long time before it’s a viable four towers again.”
Reduced number of workers at the RenCen
But exactly how many GM employees are assigned to work at the RenCen these days is unclear and GM is not saying. In October 2022, the Free Press reported that about 5,000 employees were assigned to work at the RenCen, even though many continued to work remotely.
GM’s website said in early March that 857 employees were working at the RenCen. At the time GM spokeswoman Tara Kuhnen said that number had not been updated to reflect increases since implementing the return-to-office policy in January, but she declined to provide an updated figure. According to a screenshot of GM’s website dated Oct. 3, 2023, which was obtained by the Free Press, GM listed 1,320 employees assigned to the RenCen then.
More:Repeated fires at a GM EV plant have Detroit fire officials demanding changes
Kuhnen confirmed a “small number” of employees have been transferred to other locations within southeast Michigan in recent years as the business and hybrid work arrangements evolved, but she declined to provide specific figures.
Detroit’s vacancy rate
Steve Morris, a partner with the Axios Advisors in Farmington Hills, said GM’s move to the Hudson Building “leaves an awful lot of space to lease” downtown and “adds to the vacancy rate.”
Morris, whose firm represents tenants in real estate deals, questioned who would fill that space. He said he’s not seeing companies moving into downtown Detroit from the suburbs, current tenants are not expanding, and are actually downsizing, and construction costs for renovating existing office space are up.
The downtown vacancy rate was 19% in the third quarter last year, up from about 14% a year earlier, according to a report by commercial real estate services firm CBRE. Some notable recent moves were the departures of Meridian Health and BMC Compuware from downtown’s One Campus Martius building (formerly the Compuware Building), which left 130,000 square feet of office space to fill, according to the CBRE report.
More:Detroit’s RenCen is at a crossroads — and only GM knows what’s next
Staff reporter Jennifer Dixon contributed to this article.
Contact Jamie L. LaReau: jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.
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