Deadlines to appeal property taxes is fast approaching

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As the real estate market continues to appreciate in value, commercial real estate owners are advised to review and, if prudent, appeal property tax assessments. Counties in Arizona, Utah and California have or will be issuing assessment notices and hearing appeals in the fall providing an opportunity for commercial real estate owners to control property tax expense, one of the largest expense line items in real estate.

The table below identifies upcoming appeal deadlines in the Southwestern United States.

Maricopa County, Arizona is expected to issue 37,400 supplemental notices with almost all notices resetting the taxable value of the noticed parcels.

Many commercial real estate owners will see their taxable values increase by 30 percent to 40 percent due to the gap between current taxable values and the 2018 tax year revaluation factor. With a twenty-five day appeal deadline, commercial property owners are advised to get engaged in the process before supplemental notices are issued. We often can anticipate errors in the county’s supplemental valuations before the roll is released and be prepared to engage in early and meaningful discussions with county staff.

Supplemental valuations issued to multifamily properties are of particular concern this year. In the Class A multifamily space, we are seeing current taxable values at 50 percent to 65 percent of current full cash values, or the county’s estimate of market value. New product that will be valued in the 2018 tax year supplemental roll will receive a taxable value of 73 percent of full cash value, placing those assets at an immediate competitive disadvantage to peer properties that are only three to four years older.

To learn more about the upcoming assessment appeal deadlines and the process for appealing, contact me at (602) 282-6349 or domingos.santos@am.jll.com.

About the author
Domingos leads Property Tax Services for JLL in the Western United States. In this capacity, he creates value for commercial real estate owners by reducing property tax and other state and local expenses. Drawing upon both public and private sector experience, Domingos focuses on delivering unique tax reduction strategies through assessment appeals, credits and incentives, and transfer tax mitigation and refund applications.

 

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