ANN ARBOR—Peter Allen, who's shared his real estate investing strategies with more than 3,500 University of Michigan students since 1981, turns his attention to Detroit, which he calls "one of the most undervalued big cities in the world with billions of dollars of real estate opportunity."
Allen, an adjunct lecturer at U-M's Ross School of Business, started a summer class recently at U-M's Detroit Center on Woodward Avenue, teaching 18 students who come from all corners of the city and want to be part of Detroit's turnaround.
He'll teach them how to revitalize their communities by reclaiming abandoned homes, fixing them and renting them.
"This class is going to whet your appetite and hopefully change your mindset," Allen said. "I'm going to help you not just buy and sell your house one day, but learn how to help build a lively, walkable neighborhood."
Allen is joined by three of his former U-M students to help mentor the students who signed up for the first Detroit class. After the four Saturday sessions, students will have a rehab strategy and a revenue strategy.
"I'm going to teach you in this class how to map it out. This is not some academic effort—it's a real house," Allen told students. "You will begin to figure out what you can buy it for, how much it costs to fix it up, how we can finance it and rent it out.
"It's not easy, it's not fast. This is not a 'get rich quick' class."
The class targets the six Detroit neighborhoods that are part of the Skillman Foundation's Good Neighborhoods program—Brightmoor, Chadsey Condon, Cody Rouge, Northend Central Woodward, Osborn and Southwest Detroit, said Sonia Harb, manager of the Technical Assistance Center project at U-M's School of Social Work.
"Skillman is making money available for home improvements, so we are working to marry those efforts," Harb said. "The goal is to promote home occupancy and help people generate income and wealth."
As students got to know each other at the first class on May 30, they began to think about other students they'll work with in teams of three to four on a final project. Some of the students are:
- Lanita Carter, who works in the Osborn community on the northeast side, and believes it's her duty to help clean up the neighborhood. She's an entrepreneur, law clerk and youth mentor. She's an assistant at CeaseFire Detroit, Detroit Youth Violence.
- Dana Hart, board chair, Northend Christian Community Development Inc., lives in the Northend, said she worries that if she doesn't learn about real estate investing, many in her community might be priced out of the market given its proximity to downtown and Midtown.
- Gibran Washington, AmeriCorp Green Schools Coordinator, lives in Northwest Detroit and believes there is an opportunity to present a different and successful model for urban community redevelopment using residential, commercial and retail hybrid.
- James Thomas, Morningside neighborhood resident, minister and entrepreneur, said he was interested in working with Allen, an instructor with a proven track record, to succeed in real estate himself. "I have an investment in the city. My heart is in the city. I want to leave a legacy for my children and my children's children," he said.
- Stephanie Johnson-Cobb, manager of community involvement and safety at Focus: HOPE, is taking the class for professional and personal reasons. "I've gone through everything from buying a property to foreclosure...all in this neighborhood. There are some investment opportunities in my community, and I want to help. I'm also an aspiring entrepreneur. Learning what to do and not make mistakes will help me," she said.
Allen told his students that he's now enjoying the benefits from his years in real estate investing, yet his Ann Arbor properties took 15 years to give him a cash flow.
"I'm not going to teach you how to be a millionaire. I'm going to teach you how to not lose money," Allen said. "I'm teaching this class for free. The only payback is when you do your first house, you invite me and my wife for dinner."