Ally nearing decision on new HQ
Ally Financial Inc. is expected to announce as early as Tuesday that it is consolidating its offices across Metro Detroit into one location after spending months searching for a new headquarters.
The Detroit Downtown Development Authority is meeting Wednesday, and could vote to approve incentives to keep Detroit-based Ally into one larger Detroit building.
The Metro Times reported late Wednesday that Ally — formerly GMAC, General Motors’ in-house mortgage and auto lending unit — will consolidate offices in a building in downtown Detroit. Its headquarters currently are in the Renaissance Center downtown.
Ally spokeswoman Gina Proia declined to comment on the report, but said the company has been working to find an office to consolidate its operations.
The company said in January it was considering consolidating its five locations in Metro Detroit to a single location. Ally has about 700 people working in Detroit, along with 300 at the Southfield Town Center and Galleria in addition to employees in Troy and Auburn Hills. Ideally, Ally would be housed in one space, said CEO Jeffrey Brown.
Brown said Feb. 19 that he expected to decide in the next 30-60 days whether Ally will stay in Detroit or move its headquarters to into the suburbs.
"Our desire to consolidate is all in the spirit of having our associate base together, where we believe more collaboration, creativity, idea flow, revenue creation can be worked on together," Brown said. "Wherever we are — whether it's downtown, whether it's Southfield, we're going to have a strong commitment to the southeast Michigan area."
If Ally were to leave the Renaissance Center and Detroit, it would shed the high cost of parking and the city income tax.
"It's not really at all about getting out of the RenCen and getting away from GM. We've been very transparent with GM. I've been very direct with them on this point," Brown said.
Brown became CEO in February after Ally.
The change came after the U.S. Treasury in December ended its historic six-year intervention into the U.S. auto industry, as it sold its remaining 11.4 percent stake in Ally as part of its $17.2 billion bailout. .
Taxpayers recovered more money than they injected into the bailout of Ally, but in accounting terms, the government still booked a loss on the Ally bailout. The Treasury Department recovered $19.6 billion, including dividends.
At one point, the government owned a 74 percent majority stake in Ally. In late 2008, the Federal Reserve agreed to grant Ally, then GMAC, bank-holding company status so it could qualify for loans under the Wall Street and auto rescue program. Ally got two additional bailouts totaling $17.2 billion, and Treasury tapped Ally to be the primary lender for both GM and Chrysler.
Since then, GM acquired its own lending arm, GM Financial. Chrysler has a deal with Santander Consumer USA. Ally operates a profitable online bank called Ally Bank.