Fighting For The Underdogs In Commercial Property Tax Appeals

Do rising property values justify increased property taxes?

On Behalf of | Jun 2, 2022 | Big-box retail

When a big box store or competitive corporate retailer moves into a neighborhood, their property development will have noticeable consequences for local real estate prices. Specifically, homeowners near the facility will see the value of their properties slowly increase. Having nearby amenities can mean better employment opportunities and can make neighborhoods more attractive to buyers.

Does that mean that the retail business will also see an increased property value and higher tax costs simply for helping improve the community?

Tax assessments should reflect the resale value of real property

What an individual or business pays in property tax should accurately reflect the value of their property in the current real estate market. If residential properties in an area become more desirable, then sellers can ask for higher prices for them.

Those higher prices do not necessarily mean that commercial properties will see similar appreciation. In fact, big-box retailers often take undesirable parcels and turn them into something more valuable. However, the facility they use still has limited resale value. Only a handful of other companies would have a use for a facility so large, limiting how competitive the resale market is for large buildings.

If the only justification that an appraiser can give you for the increased tax assessment for your business’s property is the rising value of nearby residential properties, then their decision may not actually hold up in court. You can appeal an increased assessment and push to get your taxes returned to a rate that more reasonably reflects the resale value of the property involved.

Keeping your tax costs low is an important part of managing your operating expenses as a big-box retailer that owns its own facilities.