Earlier this year the bankrupt city of Detroit started selling off mainly abandoned property for as little as $1,000. The city even offered a package deal recently. Called the “blight bundle,” the package included 6,350 rundown properties across the city of Detroit. And when the blight bundle entered the Wayne County tax foreclosure auction earlier this month, someone did indeed snapped it up.
A group of developers led by African-American developer Herb Strather put in a $3,183,500 bid, slightly over the required minimum for the bundle blight, and won the lot.
“Strather and his partners in the company Echo Solutions must come up with a deposit of 10 percent of the winning $3,183,500 bid within 24 hours and pay the total amount in 14 days,” reports Detroit News. They have already come up with the deposit.
Strather is also the chairman of real estate development firm Strather Associates and runs a real estate school “creating the next generation of developers in Detroit.” This latest venture actually started out as part of a class about online bidding at his Strather Academy.
“We were rather shocked [by the sale of the bundle],” Strather told The Huffington Post. “We turned on a dime, if you will, and decided to be the bidder, because we were concerned. We wanted to make sure the redevelopment of Detroit was in Detroiters’ hands.”
Strather said he has plans for the properties. He along with two dozen students who will be working to upgrade the properties. “They’re going to add a lot of great value to the development project by doing a lot of sweat equity,” he said.
In addition to this, Strather and his partners have to demolish all the blighted properties within six months and have development agreements with the county for any deemed salvageable. Failure to meet all these requirements and property ownership could revert to the county.
Many saw it will be impossible for Strather to meet these requirements and that the city actually offered these properties together to “discourage speculators from buying them individually. If Strather’s group hadn’t bid, vacant lots and houses in good shape would have gone to the Detroit Land Bank, where the sales agreement makes more demands on the buyer, and the blighted properties could be dealt with more efficiently,” reports HuffPo.
But the city promises to work with Strather and partners over the next two weeks.
“Now what we have to do is find out if indeed this group is serious about taking on such a task. And if they’re willing to do so, we’re willing to listen,” Wayne County Chief Deputy Treasurer David Szymanski said.
Strather is excited.
“I think I was born to do it,” he said. “The idea of redevelopment in my community would be a work of love.”