02 March 2010

Quicken to Bring More Employees Downtown

The Detroit Free Press
Founder wants more space in detroit as mortgage company grows

Quicken Loans would like to move another 500 to 700 employees to downtown Detroit from Livonia within the next year, in addition to the initial group of 1,700 coming to the Compuware building in May or June, Dan Gilbert, Quicken's chairman and founder, said in an interview Monday.

"We're very excited about it. We can't wait to get down there," Gilbert said.

Gilbert also said the online mortgage firm more than doubled its loan volume to $25 billion in 2009, from $12 billion a year earlier.

Quicken announced in November 2007 that it would build a new Detroit headquarters, but switched gears a year later when the nation's banking crisis hit, opting to first lease four floors in Compuware's building and delay construction of a new headquarters building until 2013.

Now Quicken is looking to lease more space and move more people downtown as it gains market share, thanks in part to a wave of bank and mortgage company failures nationwide.

Gilbert, who is majority owner of the Cleveland Cavaliers basketball team, also ruminated on the possibility of a joint arena for hockey and basketball in Detroit.

To survivors like Quicken go the spoils

With home prices still sagging and foreclosures still rampant in many parts of the country, how is it that Gilbert can say, "We had a record year, by far, in every category in 2009 -- revenue, mortgage volume, profitability, everything"?

For one thing, the law of the jungle applies. To the survivors go the spoils, in what has been a brutal period for the housing and mortgage lending markets.

Second, mortgage interest rates have stayed low, prompting a wave of refinancing by homeowners who are not upside-down on their loans. And Quicken, with what Gilbert calls its "geographically agnostic" position as the nation's top online mortgage lender, is active in all 50 states.

In a wide-ranging telephone interview Monday from Ohio, where his Cleveland Cavaliers basketball team was playing the New York Knicks, Gilbert reflected on Quicken's performance and the still-shaky housing sector.

Quicken's mortgage volume reached $25 billion last year, up from $12 billion in 2008 and a previous company record of $19 billion in 2007.

Total employment at Quicken is currently 3,013 people, up from 2,700 in late 2008, but still below the peak of 3,600 when the firm first declared its intent to build a new headquarters and move 4,000 people to Detroit.

Still, the trend is promising enough that Quicken now is scouting for more space than it already has agreed to lease from Compuware for its initial move of 1,700 staffers.

"We could probably put at least 500 to 700 more downtown," Gilbert said, if room in nearby buildings can be located. "We're just deciding what to do in the first year down there. So we're kind of looking around. It probably wouldn't happen in May or June, but maybe the end of the year."

The federal government's efforts to stabilize the troubled housing market have met with limited success. Federal programs intended to help struggling owners stay in their homes have failed, Gilbert said, because they work through mortgage loan servicers ill-equipped to deal with consumers.

"It's like an automobile recall similar to what Toyota's got going," Gilbert said, "where the government would tell the consumer to skip the dealership and take their cars directly to the manufacturing plant to get fixed."

Whatever happens, Quicken appears poised to prosper. If housing gets better, all boats are lifted. If the market stays in turmoil, more mortgage lenders and banks will fail, and Quicken will snap up more market share.

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