One of the things we thought most interesting during the press event was the anecdote Mayor Mike Duggan shared about the behind-the-scenes story on keeping Ally Financial (formerly GMAC) in the city, consolidating their 1,500 person workforce and moving along a deal to purchase a skyscraper with nearly a million square feet in it.
We transcribed it and edited very lightly to let the story speak for itself. It’s an illuminating little look that isn’t going to get printed most places, not to mention most folks don’t get to go to press conferences, so we thought we’d share. Below, the words of Mike Duggan on Tuesday.
Duggan: Last summer I heard rumors that Ally was looking to move the seven hundred employees they had in The Renaissance that were out in the suburbs and so I call their CEO Mike Carpenter (and I had a) conversation about this, and he said you know we’re separate from GM now, we’re probably going to leave the Renaissance Center, but don’t worry we’re really looking to stay someplace else downtown. I said okay, if that changes I want the opportunity to come in and present, and he says okay if it changes I’ll call you.
Well in late January there was a media report that says Ally is about to move to the suburbs, and so I call Mr. Carpenter back.
January 28th, and I say to him I know this media report can’t be right and he says well actually our plans have changed. We decided not just to look and sell a hundred people, but fifteen hundred people because it made sense to consolidate all our operations, and when we started looking at fifteen hundred people it knocked down all the (options for) our team to spend six months. There is no real estate option in Detroit, we’ve basically made the decision to go to the suburbs, and I said you know I really would like the chance that you promised before to come in and present.
He says what do you think is going to be different? I said because you’re going to get a community presentation, not something from the real estate agents, and it became a pretty tense conversation.
I finally said, your company has been in this city nearly a hundred years. You can’t give me two weeks to do a presentation? At which point he said I’d have to be a really jerk not to give you two weeks. I said that’s all I want, I said there will be no publicity, there will be no leaks. We’ll bring you a business plan, (and) I called (and) I said Dan (Gilbert) we’ve got two weeks and Dan says 1,500 people would be one of the largest business relocations in Detroit in twenty years. He says there’s a building that I’m talking to but I don’t have it nailed down. You’re telling me that I’ve got to figure out how to provide a plan for 1,500 people in a building I don’t own in under two weeks and I said yeah.
Dan says no problem.
And so we started to go to work on this and then five days later I find out my new best friend, Mike Carpenter, announces he’s resigning as the CEO of Ally.
I am like Oh My God now where are we, but the company was very responsible. They call up and said we want you to know the company’s going to honor its commitment, and I said really, and they said you’ve got nine more days. (Crowd laughs at this point).
This is the thing when you have Dan Gilbert, and Matt Cullen, and Jim Ketai and the team on your side nine days is an eternity, and what we had to put together was simple. We made a promise to Ally there was going to be no political pressure, no public pressure, it was going to be a business decision and we have two issues.
One is we had an empty office building in the suburbs and compared to a building here in the middle of a hot real estate market. We knew the rent was going to be more expensive and they had free parking in the suburbs versus the parking you would have to pay for, and so between us and Bedrock, the DDA and the City of Detroit we had to put together a competitive proposal, and I can’t say enough about Ann, and Jim, and Matt and the team. Tom Lewand did what he did, this is the reason I wanted him recruited for the private sector. It was (for) these kinds of deals along with Rod Miller and John Hill and Gary Brown, our parking person, who said here’s what we can do, we can afford to provide Ally with five hundred fifty parking spaces from our facilities or put up a $150 for those five hundred fifty spaces where they’re going to be purchased some place else. What we’re going to make in the income tax revenues will exceed that.
We will buy it, we’ll pay it out of DDA funds, economic development funds from the authority. The Bedrock team put together a competitive proposal.
There are enormous business opportunities being located in the City of Detroit today, and so this is going to be a very special thing for this city. Instead of losing 700 jobs which it looked like we did just 60 days ago, we’re actually getting a headquarters with 800 moving in for 1,500 total. And when Ally celebrates their hundredth anniversary as a company, I’m very proud to say it will be right here in the City of Detroit.