An Australian real estate developer proclaimed a hero by tenants in the crime and recession plagued US city of Detroit has been shot dead.

Greg McNichols, 45, bought a two-storey apartment complex on Detroit's east side in February, a building in such disrepair residents described it as a "rat trap", but through the Australian's hard work it began to be transformed into a livable environment.

Mr McNichols was beloved by most of his tenants and nicknamed the "Crocodile Hunter".

However, on Saturday evening he became embroiled in a confrontation at the front of the property with a woman whom other residents said was behind on her rent.

Witnesses said a man in a black Chevy Avalanche pulled up, stepped out of the car, shot Mr McNichols and then drove away.