- Miller Samuel Real Estate Appraisers & Consultants - http://www.millersamuel.com -

[Central Park v. Detroit] $363,538,692,000 v. $4,500,000


Source: Google Earth

Back in 2005, I did a fun exercise for New York Magazine – I was asked to value Central Park [1] (just for fun) in about 3 minutes. It was within an article that ranked the reasons to love New York and was item number 3 [2].

The New York Observer recently asked me to update this calculation using the same methodology (in 3 minutes and just for fun) and I came up with $363,538,692,000 [3] which is a far cry from $528,783,552,000 [1]. The same disclaimers apply as the original effort, seriously.

To put this in perspective, about 9,000 Detroit properties were auctioned [4] (hat tip WalletPop [5]) with opening bids of $500. Only 20% received bids. The total land area of these properties was equivalent to Central Park. If all 9,000 properties received a bid of $500 (which is probably not far off if you assume the 20% that received bids were over $500 and the rest $0), that represents a total value of $4,500,000.

Thats’s not much of a value and these properties also pull down values around them – plus they are off the tax roll placing more financial burden on existing properties.

Not a good sign
Most of the bidders were investors and vacant land in Detroit equals the entire footprint of Boston.

As much as I love my time spent in Michigan and my relatives there, I believe this is called an economic failure spiral.