While the housing market has been booming during the course of the COVID-19 pandemic, commercial real estate continues to struggle as more and more businesses are having to shut their doors.
Realtor Dave Abdallah said that another reason for the struggling market is fear.
“In general, the real estate market is doing extremely well,” he said. “But that’s for residential. Commercial is struggling due to COVID as many businesses have had to migrate to a working from home type of situation where possible. Also, not very many people are wanting to risk trying to open a new business at this time.”
Currently between Dearborn and Dearborn Heights, at least 70 commercial properties are for sale on the market and some of those properties have been sitting for a very long time.
“In Dearborn, there are 50 properties on the market currently as for sale,” Abdallah said. “This doesn’t include for lease locations. Dearborn Heights has 20 properties listed for sale. Some of these properties have been on the market for well over 400-500 days.”
While there are currently nine pending sales between the two cities, Abdallah said not many people have been purchasing over the last year.
“I see seven pending sales in Dearborn and two in Dearborn Heights,” he said. “In the last year, there were 26 sales in Dearborn and nine in Dearborn Heights. Every single one of the property sales for Dearborn Heights occurred in the south end of the city as well.”
Due to the low interest in purchasing commercial real estate, Abdallah said more than 50 properties have expired.
“In Dearborn Heights, 17 properties were put on the market that ended up expiring with the listing realtor or didn’t sell,” he said. “In Dearborn, there were 40. During this pandemic, there are obviously less people looking.”
Smart buyers should look towards Van Born because once Taylor and Dearborn Heights do the work to that corridor, the property value is destined to go up. — Dave Abdallah
Abdallah said that even though times are uncertain, now is still a great time to buy and invest in your future.
“You’ll get a better deal now than you will a year from now,” he said. “The interest rates are extremely low, but it is much more challenging to get a commercial loan as opposed to a residential loan.”
While both cities are working to get their commercial hubs up and going, Abdallah said it’s important to know the market and what the community is looking for.
“Dearborn has the Michigan Avenue corridor while Dearborn Heights is rebuilding Ford Road and Van Born,” he said. “Smart buyers should look towards Van Born because once Taylor and Dearborn Heights do the work to that corridor, the property value is destined to go up.”
Keeping competition in the area is great, but Abdallah said that Dearborn and Dearborn Heights are where a lot of mom and pop shops call home.
“It’s always better to buy for a new business so you don’t have to move in a few years,” he said. “But if it’s a new business that isn’t already established or like a chain, leasing may be the better option to get established. Competition forces businesses to bring more to the table, but there are a lot more entrepreneurs in the area and a lot of smaller mom and pop places that are vital to our smaller communities.”