Detroit developer buys 6,350 lots for $3.1M
- Local developer Herb Strather is leading a group of private inevstors, Echo Solutions
- The group has 14 days to come up with a 10 percent deposit
Detroit – — Developer Herb Strather was the sole and winning bidder of a bundle of 6,350 mostly dilapidated and vacant tax-foreclosed Detroit properties during an online auction that ended Tuesday afternoon.
Strather and his partners in the company Echo Solutions must come up with a deposit of 10 percent of the winning $3,183,500 bid within 24 hours and pay the total amount in 14 days.
Wayne County Treasurer Raymond Wojtowicz, in collaboration with Mayor Mike Duggan, bundled the properties in an online auction that began in mid-October. The hope was to discourage tax deadbeats. If no buyer came forward, the Detroit Land Bank was expected to take the homes, demolish the rundown ones and auction those that are salvageable to qualified bidders.
"It is my hope that this innovative packaging of properties will assist Detroit in their efforts to battle blight that has infested so many of our neighborhoods in Detroit and throughout Wayne County," Wojtowicz said in a statement released Tuesday.
Strather didn't return a call for comment Tuesday. He told The News on Monday that he wants to develop the properties by partnering with community groups and churches. He said more details would come after the auction.
Some residents have expressed concern about private buyers acquiring abandoned lots they've maintained as small farms, gardens and parks. City officials have told community leaders they would be able to buy tax-foreclosed lots for $100 if no one bought them at the auction.
The properties are scattered throughout the city. About 2,000 are vacant lots, 3,000 need to be razed and 1,000 are considered salvageable homes. Terms of the auction require the winning bidder to demolish dangerous properties within six months or submit redevelopment plans — including proof of financing — or risk losing the land.
Strather is a one-time casino investor who runs his own real estate school called Strather Academy. He was involved in the Woodbridge Estates development that replaced the Jeffries Housing project in the early 2000s and was the major owner of the Hotel St. Regis when it went into receivership in 2009.