Last week, there was an article I read (as well as several others) concerning the repurposing of empty retail box stores. In particular, the conversation turned to the aspect of shopping center owners such as Simon Properties, General Growth and Macerich acquiring some of these vacant stores. The reasoning behind these acquisitions is to create an alternative use in order to keep foot traffic at the mall, thereby supporting the other in-line retail stores. The repurposing of the stores is varied, but it appears the recent trend is to design shared office space.
This article also mentions an estimated 200 million square feet of retail space that has closed or anticipates closing since the beginning of 2017. Some of these retail stores have been closed for up to 4 years. It will be extremely interesting to see what happens to the 150+ planned Macy’s store closings based on last week’s announcements.
This may have a significant impact in the property tax world as assessors and appraisers struggle to determine the fair market value of these types of properties.
Do appraisers look at the sales of vacant retail properties to determine the value? Or should they look at the current use of the property? This argument has been building in several states over the past few years. In Kansas, it is likely this argument will be decided by the Kansas Supreme Court, possibly in the 2020 calendar year.
Mall owners are finding they must continue to come up with ways to support their malls as they cannot afford to have anchor tenants sitting vacant. It’s worth the potentially hundreds of thousands of dollars in improvements and reconfigurations in order to maintain mall traffic.
How does this affect the value of a property? That’s the $64,000 question (or more likely the $300,000 question!)
Johnson County Commercial Values Issued
Speaking of Kansas, Johnson County issued their commercial values to taxpayers last week with an appeal deadline of March 11th. Residential notices will be issued before March 1st and taxpayers will have until the end of March to file appeals if they are unhappy with the valuation placed upon their residence.
As I’ve included in previous years, the deadlines in the surrounding states which occur in the upcoming months are listed below:
Kansas – Personal Property: March 15 | Real Estate: March 11 – (commercial) Johnson County
March 31 – remaining KS Counties
Missouri – Personal Property: March 1 | Real Estate: 3rd Monday in June
Oklahoma – Personal Property: March 15 | Real Estate: Generally in June
Iowa – Personal Property: Not applicable – Exempt | Real Estate: April 30
Colorado – Personal Property: April 15 – Real Estate: May 31
Nebraska – Personal Property: May 1 | Real Estate: June 30
Arkansas – Personal Property: May 1 | Real Estate: Varies
Even though this is an “off year” in Missouri, Colorado and Iowa, appeals can still be filed based upon a valuation date of January 1, 2019. For those taxpayers in Jackson County who did not file appeals on the property, but were hit with the significant valuation increases, the opportunity exists to attempt relief for the 2020 tax year. (I will discuss Jackson County more in the April and May blogs.)
As always, if you have any questions surrounding your property valuations, please do not hesitate to reach out to me or any of the staff at Swartz + Associates. Now entering our 34th year in property tax valuation reviews (personal property, residential and commercial), we have the knowledge and relationships to professionally handle your needs anywhere in the country.
Please visit our website www.swartzandassociates.com to learn more about our experience and results.