Detroit bouncing back from bankruptcy

Bianna Golodryga
Yahoo News and Finance Anchor

It was the city on the verge of collapse, perhaps the ultimate example of how a one-time metropolis turned into a sad memory. For the past four decades or so, Detroit, once a mecca for immigrants and the heart of America's industrial revolution, not to mention pop culture, turned into a virtual ghost town. Businesses shut their doors and residents fled by the masses, from a peak of 1.8 million to around 700,000 today. The rapid decline of the auto industry, which the city once so proudly called its lifeline, unearthed a catastrophic failure. One of the nation's major cities relied solely on a single source of economic growth. And not only that, but that one source failed at its primary job: competing for customer loyalty at a time of expanding global competition.

And boy, did Detroit pay the price. First, the extremely unpopular auto bailouts, then the inevitable: the entire city asking for a bailout. It was Detroit's darkest hour. In 2013 the city made history by filing the largest municipal bankruptcy in U.S. history, to the tune of $17 billion. 

CLICK HERE to view slideshow. The old ballroom at Lee Plaza in Detroit. Closed in the 1990s, the former hotel and apartment building has become a destination for people interested in exploring Detroit's abandoned structures (Holly Bailey/Yahoo News)

 But that was then — and Yahoo is there now, on the day when the city is finally turning over a new leaf. The day Detroit successfully exited bankruptcy, and it sure does seem that it has learned its lesson. The Detroit of the future and even today resembles nothing of its recent past. Business is on the rebound. Remember those $200 houses? They are long gone as well. In fact, builders can't keep up with residential demand in the heart of the city, at least. Downtown, once a ghost town, looks like a mini version of New York City.

And the people — they are young, vibrant, eager to reclaim a city many considered gone. Technology is the future now, with companies once found only in Silicon Valley setting up shop. New infrastructure, including a modern rail system, is in the works; investors are coming back, and so is morale.

We spoke with three prominent Detroiters who never lost faith in their city. All have different backgrounds: Businessman Dan Gilbert moved his company, Quicken Loans’ headquarters to the abandoned city four years ago and now has more than 12,500 team members working in downtown Detroit. He is investing $1.5 billion into restoring downtown and has traveled the country researching how to model a new city. Famed author and journalist Mitch Albom, who has long been the unofficial ambassador of the town, has raised millions through various kinds of charity work for the city.

That's not to say that the city isn't still facing major hurdles. While millions of dollars have been pumped into downtown reconstruction, there's still massive plight in the surrounding suburbs. Abandoned homes have been razed by the thousands, leaving behind empty lots. Construction isn't moving at the pace projected, stymied by sluggish government bureaucracy. Foreclosures are still stubbornly prevalent, and many school districts are far behind national standards.

Having said that, the bankruptcy exit has finally allowed local officials to begin addressing these longstanding issues proactively, though it's clear that they will take a while to fully resolve. But the city's new mayor, Mike Duggan, has said his No. 1 goal is to bring Detroit back, and by some measures, his effort is working. The murder rate has fallen by 18 percent in the last year alone. For now, the city stands behind their leader. Everyone there is hoping that the nation will soon feel proud to call Motown "my town."