Operating Inn and Palace
For Sale
$624,999
22755 GRAND RIVER Avenue, Detroit, MI 48219
Unique investment opportunity with multiple income streams in Detroit.
Property Size8,019 SF
Lot Size0.41 Acres
Price / SF$77.94
Days on Market571
Property Features for 22755 GRAND RIVER Avenue
General Information
Standard status
Active
Size
8,019 SF
Lot size
0.41 Acres
Property subtype
Commercial/Industrial
Taxes and HOA fees
Annual Taxes
$6,229
Building Details
Year Built
1915
Listing Agency:
Reach Realty Group
(313) 363-3991
Listed By:
Milton G Owens-Crawford · License #6501380995
(313) 363-3991
Source:
Exitrealty
Added: Jan 17, 2025
Changed: Aug 8
Last Checked: Jul 15 at 10:24PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Reach Realty Group
Investment Insights
Based on property information with market context.
Located in the Oak Grove District, adjacent to The Greater Sandhill area of Melvern Hills in Detroit, this property sits on almost half an acre of land on Historic Grand River Avenue. This unique investment opportunity includes an operating Inn, a PALACE House, and a partitioned 2-bedroom studio-style apartment. The gated location offers multiple income-producing opportunities. The River Rouge Inn and PALACE House feature a newer 3-dimensional style roof, some newer model windows, a sizable backyard area, and CCTV security camera/video monitoring. There are 12 fully operational Inn rooms, some recently redesigned. The PALACE House includes ceramic tiled flooring in the kitchen and bathroom, stainless steel appliances, a stainless steel apron kitchen sink within granite countertops, and a matching center island with space for dining. The PALACE House has a partitioned rear 2-bedroom studio-style apartment that can be used as staff living quarters or an additional rental unit, along with an on-site laundry facility and more room units in the lower area. The property is within walking distance of the US Post Office, The Redford Theatre, Citizens Bank, Meijer Supermarket, and a new Community Financial Credit Union under construction on Grand River Ave. The area is experiencing significant development and growth and is close to public transportation, major highways, and other points of interest. The property offers business opportunity and expansion for investment, with potential uses such as Airbnb, assisted living, or a veteran care facility. The property is sold "as is" with Warranty Deed transfer.
Key Highlights
- Multiple income streams from the operating Inn, Palace House, and a partitioned 2‑bedroom studio apartment.
- Prime location in the Oak Grove District, adjacent to The Greater Sandhill area, on Historic Grand River Avenue, near developing area.
- Large lot: Almost a half acre of land within a gated location.
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$48,268
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
7.72%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$965,360
$965.4K
Cap Rate 7%
$689,543
$689.5K
Cap Rate 9%
$536,311
$536.3K
Market Conditions
NOI Build-Up for 8,019 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$115.5K $14.40/SF
− Vacancy
−$13.9K −$1.73/SF
EGI
$101.6K $12.67/SF
− OpEx
−$53.3K −$6.65/SF
NOI
$48.3K $6.02/SF
Area
ZIP 48219
Vacancy
12.00%
Lease Rate
$14.40 /SF/Yr
Expense Ratio
52.50%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$965,360
Cap Rate 7%
$689,543
Cap Rate 9%
$536,311
Alternative Uses
Best Use
Apartment 5plus
$1.20M
$1.05M – $1.40M
NOI $84,125 @ 7.0% cap · market cap 13.46%
Second Best
Hotel Hospitality
$689.5K
$603.4K – $804.5K
NOI $48,268 @ 7.0% cap · market cap 7.72%
Theoretical Best
Office A
$1.65M
$1.44M – $1.92M
NOI $115,295 @ 7.0% cap · market cap 18.45%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
428
Businesses Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Demographics for 48219, MI
46,811
Population
20,815
Households
2.2
Avg Household Size
37
Median Age
13%
College-Educated
87%
High-School Grad
8.4 sq mi
ZIP Area
5,573
Density / Sq Mi
$43,882
Median Household Income
$31,187
Median Earnings
$1,037
Median Rent
$84,500
Median Home Value
Market
Vacancy Rate% for Multifamily in Midwest region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Bed & breakfast - Unique investment opportunity with multiple income streams in Detroit.
Where is this bed & breakfast located?
The property is located at 22755 GRAND RIVER Avenue Detroit, MI.
What is the asking price?
The asking price for this property is $624,999.
What are key features of this property?
This property features: Multiple income streams from the operating Inn, Palace House, and a partitioned 2‑bedroom studio apartment.; Prime location in the Oak Grove District, adjacent to The Greater Sandhill area, on Historic Grand River Avenue, near developing area.; Large lot: Almost a half acre of land within a gated location.
