DETROIT – There's a saying that in real estate, the three things that matter are location, location and location.
That's certainly the case for a beat-up old house on Cass Avenue in Midtown Detroit. In 2009 it sold for $210,000 and suffered an electrical fire. But now, it's on the market for $5 million.
The price tag is so high because of where the land is.
The house is 4,700 square feet of pea-soup green-painted wood rot and sagging roof line. A caretaker lives at the home to protect against scrappers. The owners bought the home long before the district was a gleam in the late Mike Ilitch's eye and clung to high hopes.
Now the for-sale sign comes with the hefty asking price of $5 million.
"We're selling the lot and the location," Darren Johnson said.
Johnson is the man the owning family Limited Partnership hired to sell their now-prized property. They figure a prospective buyer might build on the land.
"A nice three-story restaurant or a social club," Johnson said. "Anything the city's zoning will allow you to do that would benefit the owners."
For many years, property owners in the area heard the rumors about the district's plans. The Ilitch Organization quietly bought up area lots to keep the asking prices low. But if the owners can sell at or near asking price, they will profit handsomely through patience.
Johnson said he's getting offers.
"The Pistons are coming downtown and that's more days," he said. "The arena's going to be open for business and people are just going to be flowing in the area... I'm even thinking about moving down here myself."
The house was bought for $25,000 in 2002. If it sells for $5 million, that comes out to a near 20,000 percent return on investment.