Manufacturing Vacancy Rate in Boston Hits 10-year Low

Written on November 27, 2013 at 07:42 AM

Industrial property owners in Boston, Massachusetts definitely have something to be thankful for this year. A report issued by Transwestern RBJ states that the vacancy rate for Greater Boston’s manufacturing buildings was 12.5 percent at the end of October, down from 18.5 percent a year ago. According to the Boston Business Journal, manufacturing tenants have filled up more than 1 million additional square feet of building space in the past two years, including 465,000 square feet in the last quarter alone. Vacancy rates haven't been this low for manufacturing properties since the third quarter of 2003. In the same report, it said 15.6 percent of Greater Boston’s warehouse space is vacant.

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Categories: Industrial, Real Property, Massachusetts, Warehouse

Hospitality Industry Approaching Next Phase of Cycle

Written on November 26, 2013 at 05:37 AM

The hospitality industry has been building momentum throughout 2013, and business is better than it has been in years. While many forecasters and industry professionals remain optimistic for 2014, it is important to keep in mind the cyclic phases in the hospitality industry. As we approach the next phase, challenges are likely to arise and preparation is imperative for continued momentum.

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Categories: Real Property, Hospitality, Hotels

Michigan Bill Would Exempt Personal Property Tax for Oil, Gas Wells

Written on November 25, 2013 at 08:56 AM

A new bill from Lansing, Michigan that would grant exemptions for personal property taxes related to oil and gas wells is raising concern among Michigan residents. Senate Bill 552 would exempt things like piping, machinery, tanks and other equipment used to develop oil and gas wells — plus other drilling costs — from personal property taxes. However, proponents of the bill say it is not a tax break but a legislative remedy to an “administrative error” made last year by the Michigan Treasury Department, and the change would be retroactive to 2012.

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Categories: Michigan, Personal Property, Oil - Gas - Energy - Utilities

N.J. Towns Face $29M Tax Loss from Departing Pharmaceutical Companies

Written on November 22, 2013 at 08:40 AM

As some of the world's largest pharmaceutical companies depart New Jersey, four towns face the loss of $29 million of combined revenue. Not only is it extremely detrimental to the local economies, but it hinders Governor Chris Christie's (R) efforts to drive up business and cut property taxes, which are the highest in the country.

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Categories: Personal Property, New Jersey, Real Property, Pharmaceutical

AAA Projects Slight Drop in Thanksgiving Travel

Written on November 21, 2013 at 10:02 AM

Yesterday, AAA released their annual Thanksgiving Holiday Travel Forecast. Although travel volume for the 2013 holiday is projected to decline 1.5% from 2012, it is still the second-highest volume since the recession-driven declines of 2008-2009. The moderate drop in travel is due to the sluggish recovery, which has caused economic uncertainty, as well as low consumer and business confidence in regards to the future. AAA expects 43.4 million people to travel 50 or more miles away from home during the period from Wednesday, November 27 to Sunday, December 1, 2013. And good news for the 90% of travelers that will be driving: AAA estimates that most drivers will pay the cheapest gas prices for the Thanksgiving holiday since 2010. The national average (about $3.21 a gallon) is at the lowest level of the year and should continue to drop in the weeks ahead.

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Categories: Hospitality, Hotels, Economy

Commission to Release Final Report on D.C. Tax Changes Soon

Written on November 20, 2013 at 07:47 AM

The Washington, D.C. Tax Revision Commission, a select group of D.C. officials, advocates and civic leaders, is finalizing changes that will be made to the District's tax code. After nearly a year and a half of work, the commission will release the final report before the holidays. The group spent months determining how the city raises nearly $6 billion annually in revenue, and now debates ensue on ways to adjust income, sales, property and business levies.

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Categories: Real Property, Sales & Use Tax, District of Columbia

Indiana GOP Leaders Push to Eliminate Business Personal Property Tax

Written on November 19, 2013 at 08:44 AM

Indiana republican legislative leaders are pushing to repeal business personal property tax, and several other Midwestern states are doing the same. In fact, Ohio and Illinois have already eliminated their business personal property tax, and Michigan will be shortly. However, if Indiana were to follow suit, it could cost local governments and schools $1 billion annually. Senate President David Long (Fort Wayne) and House Speaker Brian Bosma (Indianapolis) said that removing the business personal property tax would make the state more appealing to job creators, and the proposal is being supported by the Indiana Chamber of Commerce as one of its top legislative priorities.

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Categories: Michigan, Personal Property, Industrial & Manufacturing, Indiana, Illinois, Ohio, Economy

NYC Luxury Developers Receive 'Affordable' Property Tax Exemptions

Written on November 18, 2013 at 07:41 AM

Luxury developers in New York City, New York that have been "taking advantage" of Albany's affordable housing property tax exemptions are under scrutiny. The latest is a $1.5 billion 90-story residential tower located in midtown Manhattan near Central Park. One57 already sold a 14,000 square-foot penthouse for more than $90 million, and none of the future residents will have to pay property taxes for 10 years if the pending tax exemption is approved. The deal made with developer Extell is under investigation by Albany's anti-corruption Moreland Commission.

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Categories: Real Property, Multi Family, New York

Twin Cities Work Toward Business Incentive Program

Written on November 15, 2013 at 07:23 AM

In an effort to attract and retain business, St. Paul and Minneapolis, Minnesota are working to implement a standardized business incentive program. Memorandums of understanding were approved by the Bloomington City Council, Bloomington District 87 and McLean County Unit 5 school districts this week to establish a property tax abatement program. On Monday, the measure will go to the Normal City Council for approval, and will go to the McLean County Board in December.

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Categories: Minnesota, Real Property

Dozens of Commercial Property Tax Breaks Under Review in Providence

Written on November 14, 2013 at 08:23 AM

Providence, Rhode Island is reviewing dozens of tax breaks for commercial properties to determine whether or not the deals are actually benefiting the financially struggling city. Since Mayor Angel Taveras took office in January 2011, a least a dozen of tax-stabilization agreements have been approved, which were worth approximately $1.5 million in tax savings during 2012 and will yield at least $17 million in tax savings over their lifetime. In an effort to boost development in Providence, the mayor has also stated that he'd like to freeze the commercial tax rate for a number of years.

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Categories: Real Property, Rhode Island

D.C. Investor Interest Shifts to Retail Properties

Written on November 13, 2013 at 09:28 AM

The office market in Washington D.C. has been less than ideal, thanks to the short-term shocks to the region including sequestration, the government shutdown and mandates that federal agencies must decrease their real estate profiles. While this hasn't deterred investors from commercial real estate in the area, it has shifted their interest to retail space and other non-office properties, which pose less of a near-term risk. According to the Washington Business Journal, the sale of a pair of Northern Virginia retail sites could be the leading edge of that trend, in which the Sterling Plaza and Sterling Plaza II was sold for $26.5 million, as well as the Lake Montclair Center in Prince William County for $19.2 million.

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Categories: Office, Real Property, Sequestration, District of Columbia, Retail, Financial Services, Virginia

Commercial Real Estate Investors Moving to Secondary Markets

Written on November 12, 2013 at 09:28 AM

Commercial real estate investors seeking higher returns are turning to smaller markets and buying suburban properties. According to Bloomberg, demand for office buildings, retail centers and warehouses in cities such as Reno, Nevada; Greensboro, North Carolina; and Louisville, Kentucky, is surging as yields shrink for real estate on the coasts and in larger cities. Properties on the outskirts of major metropolitan areas also are attracting interest, with prices for suburban offices rising faster than downtown real estate.

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Categories: Banks, Office, Nevada, Industrial, Real Property, North Carolina, CMBS, Retail, Paradigm Info, Financial Services, Illinois, New York, California, Kentucky, Warehouse

High Demand for Commercial Real Estate Loans

Written on November 11, 2013 at 08:08 AM

The commercial real estate market is on the rise this year, especially for office properties. As the demand for mortgage loans has increased, banks have also lowered lending standards. The Federal Reserve Board reported that 21.9 percent of banks surveyed last month said they reduced credit standards for commercial real estate loans in the third quarter this year, while only 2.7 percent reported tighter standards, according to The New York Times. The net loosening figure of 19.9 percent was down a bit from the second quarter but otherwise the highest such figure since 2005, when the real estate bubble was inflating. At the same time, more banks reported rising demand for commercial real estate loans than at any time since 1998.

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Categories: Banks, Office, Real Property, CMBS, Financial Services, Economy

More Controversy with Philadelphia's Already Messy Tax System

Written on November 08, 2013 at 09:30 AM

It is no secret that Philadelphia, Pennsylvania's tax system is a bit of a mess, and the Business Use and Occupancy Tax (“U&O”) stirs up the most controversy of all. U&O is a tax on the business, trade or other commercial use and occupancy of real estate located in the city. According to the Philadelphia Business Journal, it only exists because it meets the constitutional requirement that “all taxes ... be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax...” and because the Pennsylvania Supreme Court, in a 1967 case called Madway v. Board for the Assessment and Revision of Taxes, ruled that all real estate within a taxing jurisdiction constituted a single taxable class. The effect of the Madway ruling was to prohibit taxation of different types of real estate within a jurisdiction at different rates, a common practice in many other jurisdictions.

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Categories: Pennsylvania, Real Property, New York, Economy

Arizona Likely to Grant Apple Huge Property, Energy Tax Breaks

Written on November 07, 2013 at 05:57 AM

Mesa, Arizona will be the latest location for an Apple, Inc. warehouse, and the company is likely to receive huge property, equipment, energy and payroll tax breaks and other incentives from the state. Apple purchased the failed First Solar plant for $113.6 million, and will employee 700 workers. The company has recently opened data and operation centers in Nevada, Texas, Oregon and North Carolina, and will receive as much as $196 million in tax breaks from those states.

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Categories: Personal Property, Arizona, Nevada, Industrial, Real Property, Environment, Pollution Control, North Carolina, Texas, Green Initiatives, Oil - Gas - Energy - Utilities, Oregon, Warehouse

Baltimore City Council Seeking Audit of Property Tax Program

Written on November 06, 2013 at 06:46 AM

Baltimore, Maryland Mayor Stephanie Rawlings-Blake has received an influx of calls from the City Council seeking an independent audit of the city's property tax program. After The Baltimore Sun reported persistent tax bill errors that have caused the city to miss out on millions of dollars, the Rawlings-Blake administration implemented a reform to correct the costly mistakes. The City Council wants an "immediate and thorough" audit of the Finance Department, but the mayor requests more time for the reform to yield results. A hearing is scheduled today at 5 p.m. at City Hall, in which council members can question finance officials and the state assessments agency staff about the tax errors.

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Categories: Maryland, Real Property

Iowa Implements Property Tax Rollback

Written on November 05, 2013 at 09:40 AM

The Iowa Department of Revenue has implemented the first phase of Gov. Terry Branstad's 2013 tax reform package. The law removed the assessment limitation for commercial and industrial properties. Instead, according to the Globe Gazette, the aforementioned classified property owners will receive a 5 percent decrease on taxable value (from 100 to 95 percent of the assessed value) for 2013, and the taxable value will be reduced an additional 5 percent in 2014. Residential property owners, however, received about a 2 percent increase on the taxable value (from 52.8 to 54.4 percent of the assessed value) for 2013. The "rollback" adjusts taxable values that local governments will be use to establish property taxes. Tax liabilities based on the 2013 taxable values are payable in fiscal year 2014-15 and will not be determined until local taxing bodies establish their budgets early next year.

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Categories: Real Property, Iowa

The Riverside Company Acquires Paradigm Tax Group from Monitor Clipper Partners

Written on November 04, 2013 at 12:09 PM

The Riverside Company (“Riverside”), a global private equity firm, today announced that it has acquired Paradigm Tax Group (“PTG”) from majority owner Monitor Clipper Partners (“MCP”), a Boston-based private equity firm, and the other equity holders of PTG. PTG is one of the leading providers of outsourced property tax management services to commercial, industrial, and manufacturing property owners with 31 offices across the U.S. Key leadership, including CEO Bob Dunlap and Director Oscar Diaz, will remain in their respective roles. Additional terms of the transaction were not disclosed.

Charlie Yoon of MCP, which sold its stake to Riverside said, “I would like to thank Bob Dunlap and the entire PTG Team for a great partnership. We appreciate all their efforts over the last several years and we wish them the very best as they continue on their growth path with The Riverside Company.”

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Categories: Arizona, Paradigm Info, Massachusetts

Sacramento Industrial Market Attracting New Investors

Written on November 04, 2013 at 09:41 AM

Sacramento, California's thriving industrial market continues to attract new institutional investors. The latest includes more than 450,000 square feet of space, primarily industrial with some office space, purchased by ScanlanKemperBard Companies (Portland) and Oaktree Capital Management (Los Angeles). According to the Sacramento Business Journal, the two companies have acquired the Bradshaw Business Park, Sunrise Business Center and Fruitridge Industrial Center, with a new push on leasing in the offing. Terms of the sale weren't disclosed, but the buy shows a strong argument for industrial properties in the region, which will continue to handle leases for all three properties. The new owners have already taken steps to boost occupancy by making the available spaces, which range from 1,500 to 14,000 square feet, easier to lease.

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Categories: Office, Industrial, Real Property, California

Commercial Property Construction Expected to Rise 17%

Written on November 01, 2013 at 11:31 AM

Commercial property construction is projected to rise 17 percent in 2014, according to CoStar Group, a leading commercial real estate information company. CoStar reports that future nonresidential construction spending hit a seven-month high in September, which was the second-highest mark of the year. Warehouse and hotel construction are forecast to lead commercial building activity once again in 2014, as market fundamentals continue to improve and lending becomes more readily available for construction and development projects. In addition, multifamily housing is expected to rise 11% in dollars and 9% in units. Although the gains are projected to be the smallest of the last four years, it shows the market has finally recovered and is now maturing.

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Categories: Construction, Real Property, Hotels, Multi Family, Warehouse

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