Commercial Investment Real Estate September/October 2013 - Page 8

TRENDS
MARKE T
Invest
in Detroit Now
D
Despite the dire bankruptcy headlines, the time to buy in downtown Detroit is
now, if Dan Gilbert hasn’t already bought it. Since 2007, the founder of Quicken
Loans moved his corporate headquarters and 7,000 employees from the suburbs
to Detroit’s CBD and has purchased more than 15 buildings. His vision is “a lively
live-work-play district in the heart of the city based around entrepreneurial com-
panies in the digital economy,” according to a Brookings Institution report. And
he’s not alone: New market-rate apartment complexes — the 124-unit Broderick
Tower and the 58-unit Auburn — have gone up, and St. Louis-based developer
McCormack Baron Salazar is planning a $60 million riverfront residential and
retail development. “T ese are practical real estate strategies that we know will have
a lot of market acceptance,” said Sue Mosey, president of Midtown Detroit, which
has spearheaded $1.8 billion in public-private investment in Detroit’s urban core.
Top 5 Offi ce Rent
Growth Markets
YOY % change, 2Q13
11.3%
Salt Lake City
9.8%
Denver
9.0%
New York City
8.5%
San Jose, Calif.
Columbus, Ohio
0
2
4
8.4%
6
8
10
12
Source: Cassidy Turley
“For commercial real estate, higher rates [of infl ation] mean the end of (some
would say) the artifi cial boost to the capital markets and an eventual return
to more pricing power for landlords as leasing market fundamentals continue
their oh-so-gradual tightening.”
—Robert Bach, national director, market analytics, Newmark Grubb Knight Frank
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September | October | 2013
Commercial Investment Real Estate