by Dan Rafter
Here are some facts about Detroit that you probably don’t know, courtesy of Dennis Bernard, founder and president of Southfield, Mich.-based commercial lender Bernard Financial.
- It’s a great place to raise a family
- Yes, the city of Detroit is bankrupt, but the entire Detroit market is not
- And many of the suburbs surrounding Detroit are in the middle of CRE booms
Bernard knows this because he works in the Detroit market, and has no plans on leaving the area.
“This is a really nice community. A lot of people don’t understand that,” Bernard said. “And you know what? It’s nice to be a part of changing and improving something. You can make a difference here. I am making a difference. If I was lending money in Chicago or New York or L.A. or San Francisco, any of those cities, what I was doing wouldn’t make a difference. Here I can.”
Detroit, of course, has been making news because of its recent bankruptcy filing. But Bernard says that since the filing, the city has attracted increased interest from investors and developers.
Dan Gilbert, founder of Quicken Loans, has done the most, buying several buildings in downtown Detroit with the hope of luring young professionals to the area. But Bernard says that other investors are now showing interest in the city.
And in an interesting tidbit, Detroit has become the fourth-most popular U.S. city for Chinese investors, a fact reported earlier this year by outlets such as CNN Money and Forbes.
“We’re a nation that likes underdogs and comeback stories,” Bernard said. “We are an optimisic nation. We like that Detroit was once a great city, fell on hard times and is now coming off the matt.”
Bernard said that lenders have contacted him, asking if they should do business in Detroit. He, of course, tells them that they should.
There is a benefit for those lenders who do loan money in Detroit. There is a smaller number of lenders in the city now. This means that lenders who do work here will gain access to better deals. They can work with better real estate projects and a higher quality of borrowers, Bernard said.
They can then earn a bit more spread, Bernard added.
At the same time, each month brings better news about the domestic auto industry, Bernard said. That industry is still a key one in Detroit.
“Every week someone else is buying a building in Detroit,” Bernard said. “It’s no longer only the Danny Gilbert story. He started it. He is the driving force. But now it’s become a regional thing. Companies are moving to Detroit. Tenants are moving to the city.”
There’s a shortage of engineering talent in the Detroit area, engineers that the auto companies badly need. Bernard says that this is a good thing. It means that the auto companies and the auto suppliers are busy.
And the best news? Bernard says that Detroit’s comeback is just beginning. He expects the good news here to continue.
“I used to hate waking up in the morning and reading the paper. It was always about what company was going out of business and what company was laying people off,” Bernard said. “Now it’s fun to get up in the morning, have your coffee and read the local paper. What company is epanding? What company is hiring? Who bought a building in downtown Detroit? We haven’t had that kind of experience here in a long time.”