GM to Seek $500M Loan From Detroit Pension System

CHICAGO - General Motors Corp. today will make a presentation to the Detroit Police and Fire Retirement System to try to persuade the pension board to loan the ailing automaker up to $500 million by investing in GM's prominent downtown Detroit headquarters.

GM is also trying to schedule a meeting with Detroit's general retirement system pension board to talk about a possible deal. The move is an effort to raise cash for the ailing auto giant, which wants to raise $5 billion as part of a $15 billion restructuring plan.

The city's police and fire fund has $4.5 billion in assets and the general employees fund has $3.9 billion. Early reaction from the police and fire board indicated it was not receptive to GM's request, according to local reports.

Both funds are already invested in downtown Detroit real estate, including the recently opened Westin Book Cadillac Detroit Hotel. GM has considered refinancing or selling the Renaissance Center - a collection of seven tube-shaped buildings on the Detroit River - since it purchased it earlier this year for $626 million, according to reports.

In 2005 Detroit sold $1.4 billion in taxable certificates of participation to improve the funding levels of the two pension funds. The transaction reduced the funds' unfunded liability to $147.6 million from $1.7 billion.

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