Commentary: GM’s former factories are attracting data center developers as redevelopment continues

General Motors’ historic 2009 bankruptcy was so massive that it’s taken 15 years for a real estate trust to clean up and sell the hundreds of buildings and thousands of acres of land across 14 states that GM left behind. 

And the work isn’t done yet. 

Bruce Rasher is Racer Trust’s redevelopment manager. Rasher, who has led the property sales effort since the trust was established by the U.S. Bankruptcy Court in 2011, said the remaining properties should be sold within the next three years. 

RACER stands for Revitalizing Auto Communities Environmental Response. At its inception, RACER was one of the largest holders of industrial property in the United States. 

I asked Rasher if he thought it would take so long to close this chapter in what was the biggest industrial bankruptcy in U.S. history, an event that shook the economies of Michigan and much of the manufacturing-dependent Midwest. 

“I’ve been so focused on the mission I really didn’t think about it,” said Rasher, a former mayor of Marshall. “Some properties take a long time before they sell.” 

GM’s bankruptcy reorganization was highly controversial because it was financed by a nearly $50 billion taxpayer bailout through the federal Troubled Asset Recovery Program. TARP also saved a dying Chrysler, which filed for bankruptcy a month before GM.

The bankruptcy split the automaker into two companies: “new” GM, which continued as an ongoing concern, and “old” GM, which consisted of unwanted property transferred to RACER. 

A Gallup poll at the time found 51% of Americans opposed the auto bailouts. GM was derisively called “Government Motors” for years. 

Mitt Romney, a former U.S. Senator from Utah and a Michigan native, famously wrote in the New York Times in 2008 that the federal government had no business bailing out GM and Chrysler. 

But without federal aid, GM and Chrysler might have failed, wiping out more than a million U.S. jobs, according to a forecast by the Center of Automotive Research in Ann Arbor. 

Racer Trust was allocated $500 million from TARP for the massive environmental cleanup required before many of GM’s former factories and land could be sold. 

The trust is responsible for monitoring, groundwater treatment and environmental stewardship of some of the more heavily contaminated properties for 100 years, Rasher said. 

Another $250 million was granted for other costs of selling the properties. Proceeds from the sales go to offset about $100 million in RACER costs that TARP didn’t cover, Rasher said. RACER doesn’t disclose sale prices of its properties. 

The trust’s work hasn’t undone all the economic carnage inflicted by GM’s bankruptcy on struggling communities like Flint, Saginaw and Pontiac that were GM company towns for decades. 

GM cut 20,000 jobs, shuttered 14 assembly and parts plants and terminated the franchises of 2,000 dealerships in its bankruptcy reorganization, according to the MotorCities National Heritage Area.  

But a recent economic impact study commissioned by Racer found that tens of thousands of new jobs and billions of dollars in business investment have been generated at the former GM facilities. 

Nearly 82,000 permanent direct and indirect jobs with annual payrolls of $7.6 billion have been created at the former GM sites, an annual average of $92,700 per job.  

The new business investment has generated $63.6 billion in overall economic impact across the 14 states where GM had operations. 

 All the former GM’s 166 buildings—mostly factories, warehouses and offices—and 75% of the nearly 7,000 acres of vacant land have been sold, Rasher said. 

The buyers represent a mix of industries, creating a much-needed economic diversification in communities that were overly dependent on manufacturing. 

United Wholesale Mortgage employs 4,300 people at GM’s former sprawling Centerpoint engineering campus in Pontiac, the most of any sites sold by Racer Trust, according to the study. 

Most of the more than two dozen remaining properties are being marketed by Racer as potential sites for data centers, warehouses, and solar and battery storage facilities. Among them are former assembly and parts plant locations in Lansing, Saginaw and the Flint area. 

Rasher said he gets as many as 10 feelers a week from developers inquiring about those properties for possible data centers. 

“It’s like a gold rush right now,” Rasher told me when I spoke with him on Election Day. 

That could change with Democrats taking control of the U.S. House and Senate, as well as the Michigan Legislature and governor’s office in the blue tsunami. 

Strong opposition by voters to data centers needed to power artificial intelligence helped Democrats across the country defeat Republicans in last week’s election. 

But if the Democrats can work to restore economic policy certainty that businesses crave, the way could be cleared to sell the remaining properties RACER holds. 

“I truly believe that, based on inquiries from developers, uncertainty about the business climate, high interest rates and tariffs are causing them to hold off,” he said. 

Rasher said the sale of GM’s former facilities was a team effort involving federal state and local governments and their economic development arms. 

“I think this is a model for helping communities hurt by severe economic circumstances,” he said.