Opportunities Seen in the Motor City
Wall Street Journal reports: Though it sometimes feels like no one is closing deals in Detroit, at least one person has been actively pursuing properties in the beleaguered Motor City. Quickens Loans Founder Dan Gilbert has been scooping up distressed and non-distressed Detroit office buildings at a time when square footage in the market is near a 10-year low.
A recent Wall Street Journal article detailed the latest property being targeted by Mr Gilbert. The abysmally occupied 25-story First National Building is under contract to Mr Gilbert’s firm for $8 million, or just $10 per-square-foot. This unit pricing, the Journal said, would be only slightly higher than Detroit’s previous low of $9 per-square-foot, recorded in 2005 for the Labor Building on Woodward Avenue. The First National Building’s price likely reflects its distressed status, as, indeed, Mr Gilbert’s firm would be acquiring it through a debtor trustee sale after the former owners fell into trouble on its loans in 2009.
After purchasing nearly two million square feet of office space in downtown Detroit this year, Mr Gilbert’s endgame is to spur a technology hub in the city. He believes Detroit’s central business district needs some work, as do some of the properties themselves, but he describes the opportunities available as “outrageously cheap” and told the Journal that, “…there ain't no way in the world you're replicating [the buildings] for that price."
View the full article on Wall Street Journal: Opportunities Seen in the Motor City
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Posted by: Nina Turner