Quote Originally Posted by Dexlin View Post
This, the market is still not strong enough to support mid-range projects. Unless you're building at either end of the spectrum - government subsidized and students apartments on the low-end or luxury apartments/condos on the high-end - banks are funding the stuff in the middle, and developers want the quick buck regardless.

Detroit has fallen far enough where I'd like to see increased density across the income scales in and around downtown in general, but until that happens, we're going to see really upper-end stuff or lots of small, low-end stuff.
I agree with Dexlin's analysis here but will add that the mid-range stuff will all come in due time. Someone feel free to choke me for saying "trickle down", but that's the inevitable conclusion.

People in the mid-range market don't want to live next to a bunch of abandoned buildings. They don't feel safe there. They don't have enough money to pay for private security. It's just a bad fit, and they can find what they're looking for in the suburbs.

So why not take the abandoned buildings and turn them into a mid-range rental? You can't. The cost to rehab is too high, and the risk is too great to do a project and then not squeeze every potential rent dollar per square foot.

But with every luxury-end that gets done, you're setting the rent comps high and lowering the risk for the next developer. [[Which is riskier, doing the first rehab on a a block of abandoned high-rises? Or doing the last one?) As those risks get lower [[and they are getting lower as the luxury end gigs get filled), more and more investors will be comfortable getting in. I think we'll get more and more diversity among the income scales as development becomes less and less of a crapshoot, which for decades in Detroit, it has been.

I can see Downtown and Midtown becoming luxury high rent [[$1.50 PSF?!?!) while the Corktown/Woodbridge/Lafayette Park surrounding would be more of the $1-$1.25 PSF because of its proximity.

And then the true "middle income" places will be another ring around that.

That's my gut feeling, anyway.