Paradigm Tax Group is pleased to remind you that the property tax appeal deadline for properties located in New Jersey is April 2nd.
Some of Arizona's 2013 Real Estate Values have been mailed and Appeal Deadlines are quickly approaching. The new 2013 property values are out in some counties and will continue to be released throughout February. The deadline to appeal these values is 60 days from the date they were postmarked.
Washington D.C.'s Real Property Tax Appeals Commission, the eventual replacement to the Board of Real Property Assessments and Appeals (BRPAA), still stands with no members on the panel. According to the Washington Business Journal, the BRPAA was abolished back on October 1st, but was left in place on an interim basis until new leadership was nominated and approved. Now, some five months later, nominations are finally expected within the next 30 days. Until the Commission becomes fully operational, the interim BRPAA has only seven of 18 possible members hearing the 4,563 appeals received for the 2012 tax year. These hearings, which have been going on since September, will continue well into April, far past the February 1st statutory deadline.
Some of Silicon Valley's most valuable commercial real estate is being taxed at rates up to ten times larger than neighboring land that is being taxed at values all but unchanged from what they were decades ago. According to The New York Times, this is because, in 1978, California voters passed Proposition 13, a ballot initiative that allows state and county governments to increase the tax rate on commercial and residential properties based on the value of new buildings constructed, but forbids government to reassess a property's underlying land to full market value without change of ownership.
More capital is expected to come back into commercial real estate in greater volumes and across multiple lending sources throughout the remainder of 2012. According to the CoStar Group, a survey administered by Jones Lang LaSalle of 20 institutional lenders has reported positive expectations for 2012 funding aims including a 12% uptick in expected capital placement this year. Lenders seem to now be more accepting of risk and indicate higher levels of cash flow for secondary markets and property types.
The apartment vacancy rate in five of six major Colorado metro areas fell in the fourth quarter of 2011 to a combined rate of 5.6%. According to the Denver Business Journal, the 5.6% rate was down from the 5.8% rate at the same time the previous year and was the lowest statewide apartment vacancy rate since measurements began in 2007. Denver specifically fell to 5.4%, the lowest fourth-quarter total in 12 years, where Greeley was the only city to report a year-over-year increase in vacancies from 5.1% to 6.4%.
The current state of the CMBS market could have a serious impact on the pace of US hotel investment in 2012, as it is predicted that $30 billion in CMBS hotel loans maturing this year may be extended. According to Hotel News Resource, the US hotel market went into a two-year slump in 2009 and 2010 before making a comeback in 2011 with around $15.2 billion in transactions. 2012 deal volume should continue at last year's pace with approximately $15 billion of total transactions, as institutional and foreign investors return to the market while REITs pull back.
Complicated deals with multiple moving parts may be a thing of the past as experts agreed that the simpler the transaction, the easier it is to get a loan for multi-family construction and refinancings. According to GlobeSt.com, major multi-family developers are spreading throughout all five New York City boroughs as of late, but the major emphasis still lies in Manhattan. The entire city is becoming more mainstream and diverse with a strong financial presence.
A recent tax case before the Tennessee State Board of Equalization had found that tangible personal property must be valued separately from intangible costs incurred to ship, configure or install the property. While this case is on appeal before the Assessment Appeals Commission, the ruling does tend to conform to other similar cases. The record shows that , “…the valuation of an asset for financial reporting “book” purposes was different in purpose and unrelated to determining the fair market value of an asset for Tennessee property tax purposes.”
While the regulations require “gross capitalized costs” in the reporting of assets for taxation, and although the Division of Property Assessments recommends the inclusion of the same, the Administrative Judge found that the inclusion of intangibles as part of the gross capitalized costs was in violation of the legislature’s intent under the State Constitution, Art. II §28.
Tennessee TPP renditions will be due March 1st and Paradigm Tax Group would recommend filing a non-standard valuation request on the initial filing to take advantage of any intangible carve outs.
The most recent crop of commercial mortgage REITs are predicted to be less risky investments than those that operated during the pre-recession real estate boom. According to the National Real Estate Investor, the new commercial mortgage REITs operate more prudently than their predecessors and boast improved transparency, making it easier for investors to understand the fundamentals of business.
The Construction Backlog Indicator, a forward-looking national economic indicator that reflects the amount of work that will be performed by commercial and industrial contractors in the coming months, increased 10.9% in the fourth quarter of 2011 over a year earlier. However, according to the Boston Business Journal, the backlog indicator fell 3.2% from the third quarter of 2011 to 7.8 months, down from 8.1 months.
Overall apartment sales prices per unit in the Washington DC area had recovered to 2007 levels over the course of last year. According to The Washington Post, 81 apartment deals closed in the area in 2011, with four specific properties going for more than $500 a square foot. However, the area is now left with the question as to whether or not this activity is sustainable as developers continue to add units.
Despite setbacks to the US economy late in 2011, the retail property sector has performed much better than what was forecasted and looks to have strong potential for significant upside. According to GlobeSt.com, a National Retail Report released by Marcus & Millichap says that space absorption improved for the ninth consecutive quarter, while construction starts fell to their lowest level in 20 years. In addition, net absorption should rise to 77 million square feet, surpassing the 32 million square feet of new supply and tightening the US vacancy rate to 9.2% by the end of 2012.
No one decides that they want to be a property tax consultant when they grow up. Most property tax consultants started their careers somewhere else, ended up in property tax consulting, and could not escape. The reason for that is that once the knowledge and experience is gained, it is very marketable and secure. Property taxation has always been the foundation of local government and it is unlikely to change.
Trailing only Manhattan in total volume, the Washington DC area had a big increase in office sales over 2011. According to Cassidy Turley's 2012 State of the Capital Markets report, Washington DC had $7.2 billion in office sales volume last year, up 68% from 2010 and well above the historic average of $5.4 billion. Overall, Washington DC saw 73 office transactions completed in 2011 as the region continues to be a strong market for investors.
Experts convened by the Building Owners and Managers Association have agreed that the existing office supply in the United States is sufficient enough to harbor the nations white-collar workers. According to The Globe and Mail, the traditional idea of an office space and the idea that as the number of office jobs increase, it will lead to an increase in demand for office space, just doesn't hold any more. The reasoning behind this is that in today's work environment, due to advancements in technology, companies already occupy about 50% more office space than they actually need.
A new annual report, Expectations & Market Realities in Real Estate 2012, found that commercial real estate may provide a foundation for investors looking for balance in their portfolios during these uncertain times. According to PR Newswire, findings in the report indicate that the economy remains sluggish with unprecedented fits and starts, and slow growth is possible for 2012 with hopeful expectations beyond that point. While capital is still available in commercial real estate investments, there is still concern that investment discipline may be faltering for top assets.
Proposals to slash commercial property values by 40% in Iowa in order to lower property taxes are being met with great resistance from advocates of local governments. According to the DesMoinesRegister.com, sources say that the proposal to cut property taxes that currently sits at the top of Iowa Governor Terry Branstad's legislative agenda would almost certainly lead to cuts in police and fire protection, libraries, and road maintenance and safety inspections.
The recent elimination of California redevelopment agencies should cause a large amount of Bay Area properties to hit the market in the upcoming months. According to the San Francisco Business Times, the potential of dozens of properties hitting the market could provide opportunities for private landowners and developers to snap up sites at potentially fire sale prices. The downside is that years of city work on development proposals and millions of tax dollars could go to waste.
New York City Real Estate Assessment notices have now been published and delivered. This is a friendly reminder that the deadline to appeal your assessment is March 1, 2012.