The Penobscot building in downtown Detroit just sold for $5M to a Toronto based company. The selling price was $5.00 per square foot for the 1M square foot building. Detroit office space vacancy rates are currently around 25%. But for the same amount of money you can get 173 Perry Street, Unit 4N in Manhattan. Assuming you live there or can rent it out the vacancy rate should be zero.
Now, 173 Perry Street, Unit 4N does have some drawbacks. It’s only 1,817 square feet. The Penobscot building has 998,183 square foot advantage. Unit 4N also has only 3 bathrooms whereas Penobscot has that many or more on each floor. Unit 4N also requires that you figure out your own parking situation.
But on the plus side, Unit 4N does have 2 bedrooms. The Penobscot building cannot really claim any bedrooms but with the addition of some closets you might be able to get it up to a few hundred bedrooms. Just make sure to get a building permit if you want to list it that way. While it might be annoying you could always rent out the rest of the Penobscot building to other people.
Detroit has many more bargains to offer if you’re willing to expand your horizons.
Source: WSJ
