Fort Shelby Residences Investment
For Sale
$680,000
525 W Lafayette Blvd, Detroit, MI 48226
Two high-floor condos in Detroit's Central Business District.
Property Size2,209 SF
Lot Size0.03 Acres
Days on Market165
Property Features for 525 W Lafayette Blvd
General Information
Standard status
Active
Size
2,209 SF
Lot size
0.03 Acres
Property subtype
Commercial
Taxes and HOA fees
Annual Taxes
$2,179
Building Details
Building Size
2,209 SF
Year Built
1927
Units
2
Listing Agency:
Berkshire Hathaway HomeServices The Loft Warehouse
(313) 693-3741
Listed By:
Jerome Huez · License #6501368881
(313) 693-3741
Source:
Elliman
Added: Mar 11
Changed: Aug 14
Last Checked: Aug 21 at 1:28PM
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 Berkshire Hathaway HomeServices The Loft Warehouse
Investment Insights
Based on property information with market context.
Located in the heart of Detroit’s Central Business District, the Fort Shelby Residences present an investment opportunity. The offering includes two high-floor condominium units situated just below the penthouse level. Both units are fully leased through July 2026, providing immediate cash flow. Residents have access to amenities of the Hilton DoubleTree Hotel, including lobby reception, coffee shop, restaurant and bar, business and reception center, and fitness room. The residential floors are located above the hotel in the Albert Kahn tower. The property benefits from low property taxes—less than $3,000 per unit per year—due to the NEZ-Rehab tax abatement in place through 2032. The Home Owners Association does not restrict long-term leasing, but short-term rentals are not permitted. The condos are positioned for appreciation with continued development throughout West Downtown, including the Cambria Hotel, Water Square Apartments, and the Ralph C. Wilson Jr. Centennial Park. As individual condominium units, they may also be sold separately in the future.
Key Highlights
- Immediate and reliable cash flow from fully leased units through July 2026.
- Extremely low property taxes (less than $3,000 per unit per year) due to NEZ‑Rehab tax abatement through 2032.
- Prime location in the heart of Detroit's Central Business District, with ongoing development projects enhancing property value.
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
$23,174
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
3.41%
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%
$463,480
$463.5K
Cap Rate 7%
$331,057
$331.1K
Cap Rate 9%
$257,489
$257.5K
Market Conditions
NOI Build-Up for 2,209 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
$45.1K $20.40/SF
− Vacancy
−$2.9K −$1.33/SF
EGI
$42.1K $19.07/SF
− OpEx
−$19.0K −$8.58/SF
NOI
$23.2K $10.49/SF
Area
Detroit, MI
Vacancy
6.50%
Lease Rate
$20.40 /SF/Yr
Expense Ratio
45.00%
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%
$463,480
Cap Rate 7%
$331,057
Cap Rate 9%
$257,489
Alternative Uses
Best Use
Apartment 5plus
$331.1K
$289.7K – $386.2K
NOI $23,174 @ 7.0% cap · market cap 3.41%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$487.3K
$426.4K – $568.5K
NOI $34,112 @ 7.0% cap · market cap 5.02%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
4,933
Businesses Nearby
Explore this area
Business Placement
Demographics for 48226, MI
6,307
Population
5,160
Households
1.2
Avg Household Size
37
Median Age
53%
College-Educated
93%
High-School Grad
1.2 sq mi
ZIP Area
5,256
Density / Sq Mi
$69,813
Median Household Income
$60,957
Median Earnings
$1,714
Median Rent
$307,700
Median Home Value
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Residential income property - Two high-floor condos in Detroit's Central Business District.
Where is this residential income property located?
The property is located at 525 W Lafayette Blvd Detroit, MI.
What is the asking price?
The asking price for this property is $680,000.
What are key features of this property?
This property features: Immediate and reliable cash flow from fully leased units through July 2026.; Extremely low property taxes (less than $3,000 per unit per year) due to NEZ‑Rehab tax abatement through 2032.; Prime location in the heart of Detroit's Central Business District, with ongoing development projects enhancing property value.
