Chinese Investors Snap Up Property In Bankrupt Detroit

China is experiencing a massive migration of its wealthiest citizens and their money to other countries, especially the United States.  Until the recent decade, few Chinese had any wealth; this is a new phenomena.  But now China has a rapidly growing middle and upper class, and an increasingly shaky economy, and wealth flows toward more secure environments.

If they could buy Broadway and Park Avenue, they would.  Rich Chinese investors are the biggest buyers of high-end luxury real estate in New York. And on a national level, they replaced Canada as the leading foreign buyer of American properties.

“The Chinese like anything new, and they like brand named locations like Central Park South,” says Dottie Herman, CEO of Douglas Elliman, one of the leading real estate brokers in the city.

The property market in China, coupled with a stronger currency, is also enticing Chinese millionaires to buy homes here. Beijing no longer permits individuals to own more than two properties, even as an investment. So a growing number are going abroad as cash buyers.

But what do you do if you're a Chinese millionaire who isn't millionaire enough to buy property in Manhattan?  Or Hollywood?  Or Hawaii?

You buy property in Detroit.

With family homes regularly selling for around $10,000, the beleaguered Motor City is now the number-four destination for Chinese housing investors in the U.S. Bigger spenders have already snapped up some of Detroit’s most iconic commercial buildings.

A Chinese company named SouFun lists thousands of abandoned Detroit properties on its website at a price of $10,000 each.  Buyers snap them up, sight unseen.

“700,000 people, quiet, clean air, no pollution, democracy — what are you waiting for?”

Michigan Governor Rick Snyder has made several trips to China for the purpose of encouraging Chinese investment in Detroit.   Chinese investors are listening.

In Sept. 2013, property developer Dongdu International Group of Shanghai (DDI) shelled out $13.6 million — the price of one of Shanghai's upscale apartments — for three iconic structures in Detroit, including the Detroit Free Press building and a complex built by Kmart founder Sebastian Kresge.

“Detroit is like Shanghai in that it has many classical and iconic buildings," the company said on its website.  "DDI through its successful history has had had great experience in bringing these types of buildings back to life.”

Ask not for whom the Dongdu, the Dongdu for.........never mind.   Momentary lapse there.

The Chinese are awash in capital and see opportunity in Detroit.  American companies, some of them, are likewise awash in capital and expertise, and have not invested in Detroit.   The long-term question becomes:  Who has the better vision of Detroit's future, the Chinese or the Americans?