How We Help Clients Navigate Property Tax Appeals

Property Tax Appeal negotiationMost owners of larger properties tend to appeal their assessed values regularly. “It’s kind of a dance between the property owner, the county tax offices, their legal department, and local tax representatives, to lower their tax obligation,” explains Certified General Appraiser Mark Nelson, MAI.

Part of this process means Iowa real estate owners must be prepared to appeal their assessments, which have effective dates as of the first day of January in a given year. This takes into account the condition of the property and any additions to the building in the last year. Owners need to get their assessment appeal completed by April 1 for it to be considered by the Board of Review.

Settling without a trial is the ideal outcome. Working with a local commercial real estate appraisal firm makes this process easier. It also makes success more likely. Once the assessment is complete, local Boards of Review submit their report to the director, then the informal hearing process begins.

In the past couple months, we provided appraisals to several County Assessors in Iowa which helped them successfully settle property tax appeals. The property owners protesting were large retail store owners. Some of the retail owners have locations throughout the Midwest, with one having stores across the United States.

It’s not merely the large, multi-state and international corporations benefitting from this type of appeal. We also provided appraisals for several smaller, local property owners, assisting them in successful appeals. Due to their tighter cash flows, our services can be of greater benefit to these clients.

Roy R. Fisher is an appraisal firm that knows the area and has what the appraisal industry refers to as geographic competence. This was key in navigating the appeal process and paid off with successful appeals. An appraisal from a regional expert can make all the difference.

Whether you run a small business or a large multi-national corporation, you need local and regional experts on your side. Even if your appeal does have to go through a formal court case hearing, often happening in November or December, appraisers like those at Roy R. Fisher are called on to be expert witnesses in such cases.

In the field of corporate real estate, having appraisers who know the region in which your company owns property is vital. As Mark Nelson, MAI says, “This is a significant percentage of our business, and we’re recognized throughout the state for our expertise in this area.”

Reach out and contact us to see if a tax appeal is right for you!

What Qualifications do Appraisers need?

man appraising building

Many career paths require years of previous experience. The same is true with appraisers. There are different levels of qualifications and certificates when it comes to a commercial appraisal career. To begin, appraisers must be familiar with the Uniform Standards of Professional Appraisal Practice (USPAP). This set of standards covers topics such as ethics, confidentiality, competencies, and standards for practice in valuation and reporting.

Appraisal licenses and certificates are then split between residential and general (commercial). Iowa and Illinois licenses require about 28 hours of continuing education every two years; however, this can vary from state to state.

With commercial appraisers, they also need to be competent in specific types of properties. Competencies have two main factors: the type of space and the geographic location. For instance, it may be obvious a residential appraiser from Los Angeles would struggle to appraise a car wash in the Quad Cities. Yet there would still be major challenges if a local appraiser who is competent in hotels and motels tried to evaluate that same car wash. There are so many factors affecting a commercial appraisal, which is why it is important to look for firms who have experience with your type of property in your geographic area, or a similar area. The Quad Cities is a unique market since it straddles the border of two states. Roy R. Fisher can work both sides of the Mississippi River with relative ease; although, Iowa and Illinois generally have considerably different market dynamics. Appraisers need to be aware of the continual changes within their area of competency. They need to understand the major employers in the area, information about upcoming developments, even what new laws are in place on local, state, and national levels which may affect property values. Appraisers also need to understand market ratios, such as how much office to manufacturing space is appropriate for a geographic area.

Our appraisers are licensed in Iowa and Illinois with knowledge of how the different markets work together in the QC region. This is another crucial area we take into consideration when evaluating local commercial properties.

Overall, appraisers need to have expertise in the four following areas: familiarity with the USPAP, a state license, at least one competency, and prior experience. If you’re looking for an appraiser, be sure to ask about their past work history to find out if there is a match with their focus or competency and your specific property. Check out our services page or contact us to see if an appraisal is right for you.

Our 2024 Commercial Real Estate Predictions

This has been a major year for commercial real estate in the Quad Cities in many ways. Looking into 2024, we have three main predictions based on trends we’re seeing locally, regionally, and nationally.

commercial appraisal and litigation

  1. “There’s a lot of potential for disrupters, whatever they may be.”

2024 is an election year. This isn’t great news for a market that relies on investors who are not interested in gambling when it comes to inflation, interest rates, and other laws which could majorly affect how and where they do business. Additionally, current geopolitical and environmental issues could lead some investors and businesses to pause until the election cycle has ended.

  1. “There’s a lot of capital with no place to go.”

A trend we believe will continue from 2023 and into 2024 is the purchasing of distressed buildings. There are some positives and negatives to this piece. When buying a distressed building, it is important to have the building thoroughly inspected and appraised. Recently, a building purchased in the Quad Cities was found to have nearly $1M in damage due to a collapsed roof. The repairs had been estimated to cost $250,000 a few months before the collapse.

The tension between the existence of start-up capital and the need for major renovations on many buildings in the Quad Cities is leading to some hesitation. On top of this, anyone who has already locked in a low-interest rate on their building is generally not going to move out for a higher interest rate.

  1. “Large corporate offices are still seeing low market values.”

One major disruptor from nearly 4 years ago is the continuation of the effects of the Pandemic. Large corporate offices are not returning to their former value, even as many offices call their employees back to work. There’s a lot of uncertainty and caution among real estate investors because of this new trend.

As 2023 comes to an end, it is important to take stock of the year before moving into the next one. Despite high-interest rates, uncertainty, and population decline, there have been many investments and new businesses appearing in the Quad Cities.

At Roy R. Fisher, we provide commercial real estate appraisal and litigation services. If you are interested in working with us or would like to join our team, please reach out.