Renovated Creative Office
For Sale
$3,950,000
1938 FRANKLIN ST, Detroit, MI 48207
Newly renovated elevator building with creative office space, high ceilings, exposed brick, and extensive building upgrades.
Property Size28,078 SF
Price / SF$140.68
Days on Market663
Property Features for 1938 FRANKLIN ST
General Information
Standard status
Active
Size
28,078 SF
Property subtype
Industrial
Amenities
3
Rubber
200120
Building Details
Year Built
19
Tenancy
Multi
Listing Agency:
O'Connor Realty Detroit, LLC
(313) 963-9891
Listed By:
Vincent Mazzola · License #6501387170
Source:
Xome
Added: Oct 19, 2024
Changed: Aug 8
Last Checked: Aug 11 at 5:19AM
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 O'Connor Realty Detroit, LLC
Investment Insights
Based on property information with market context.
This newly renovated elevator building provides creative office space with features that reflect an industrial aesthetic, including ample natural light, high ceilings, and exposed brick and beams. Capital improvements include new roof systems, energy-efficient windows, new HVAC units, and renovated bathrooms. Tenant amenities include a conference room, kitchenette, bike storage, high-speed Wi-Fi, and a private shower room.
Located at 1938 Franklin Street Unit SourceFi on Detroit’s East Riverfront, the building offers direct proximity to the Riverwalk and the Dequindre Cut, providing walk, bike, or scooter access toward downtown, Eastern Market, and Lafayette Park.
The building is described as hosting a community of creative professionals, with spaces supporting a variety of media, architecture, fashion, wellness, community services, and other related uses.
Located at 1938 Franklin Street Unit SourceFi on Detroit’s East Riverfront, the building offers direct proximity to the Riverwalk and the Dequindre Cut, providing walk, bike, or scooter access toward downtown, Eastern Market, and Lafayette Park.
The building is described as hosting a community of creative professionals, with spaces supporting a variety of media, architecture, fashion, wellness, community services, and other related uses.
Key Highlights
- Newly renovated elevator building on Detroit’s East Riverfront offering creative workspace with ample light and high ceilings
- Features exposed brick and beams for an industrial‑era look in updated office spaces
- Capital improvements include new roof systems, energy‑efficient windows, new HVAC units, and renovated bathrooms
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
$284,457
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
7.20%
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%
$5,689,140
$5.7M
Cap Rate 7%
$4,063,671
$4.1M
Cap Rate 9%
$3,160,633
$3.2M
Market Conditions
NOI Build-Up for 28,078 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
$491.9K $17.52/SF
− Vacancy
−$112.7K −$4.01/SF
EGI
$379.3K $13.51/SF
− OpEx
−$94.8K −$3.38/SF
NOI
$284.5K $10.13/SF
Area
Detroit, MI
Vacancy
22.90%
Lease Rate
$17.52 /SF/Yr
Expense Ratio
25.00%
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%
$5,689,140
Cap Rate 7%
$4,063,671
Cap Rate 9%
$3,160,633
Alternative Uses
Best Use
Office B
$4.06M
$3.56M – $4.74M
NOI $284,457 @ 7.0% cap · market cap 7.20%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$6.19M
$5.42M – $7.23M
NOI $433,588 @ 7.0% cap · market cap 10.98%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Current Use
Lease Details
Multi-tenant
Tenancy
Location Intelligence
Trade Area within ½ mile
942
Businesses Nearby
Explore this area
Business Placement
Demographics for 48207, MI
21,704
Population
13,026
Households
1.7
Avg Household Size
42
Median Age
35%
College-Educated
88%
High-School Grad
6.3 sq mi
ZIP Area
3,445
Density / Sq Mi
$44,561
Median Household Income
$43,377
Median Earnings
$1,040
Median Rent
$193,800
Median Home Value
Market
Vacancy Rate% for Office in Detroit, MI
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Creative space - Newly renovated elevator building with creative office space, high ceilings, exposed brick, and extensive building upgrades.
Where is this creative space located?
The property is located at 1938 FRANKLIN ST Detroit, MI.
What is the asking price?
The asking price for this property is $3,950,000.
What are key features of this property?
This property features: Newly renovated elevator building on Detroit’s East Riverfront offering creative workspace with ample light and high ceilings; Features exposed brick and beams for an industrial‑era look in updated office spaces; Capital improvements include new roof systems, energy‑efficient windows, new HVAC units, and renovated bathrooms
