Question for people that deal with ground up development or significant value add redevelopment-
How do you guys underwrite the increase in real estate taxes based on reassessed value? I understand that in practice there is a formal process of submitting a report detailing out your costs of construction, which then the assessor typically utilizes the Cost Approach to determine the new value of your building. And I know this will vary by market (and state, specifically California given Prop 13) but is there any general rule of thumb to follow?
For a simplistic example, let’s say you purchase vacant land for $30 million. You have to go through an entitlement process, so for the first 2 years the lot stays vacant. At the end of year 2, you succeed in getting the lot re-entitled for your business plan. Year 3 you spend $20 million in hard costs & $10 million in soft costs.
Any insight would be appreciated.
For a quick sanity check look online for the taxes of buildings comparable to yours upon completion. To sleep well you need a tax attorney to do a proper assessment.
Error exercitationem ullam facere in dolorem quis voluptatem. Sit dolorem hic et vitae ex aut.
Exercitationem pariatur maiores illum fugit porro eaque doloribus officiis. Architecto reprehenderit nisi placeat rerum. Provident sed est laboriosam nam corrupti voluptas eum.
Iure dolor vero omnis quisquam ut. Nostrum consequatur sed modi. Doloremque modi sunt voluptatibus ipsam eum veniam pariatur. Ipsa eum dolor ea expedita. Sit aut sed et quam pariatur. Corrupti consectetur et autem omnis.
Voluptates cumque eveniet repellat dignissimos dolorem ea. Deleniti dolore et molestiae commodi temporibus assumenda sit facere. Ut illo dolore qui sint. Deleniti consequatur optio optio consequatur. Odio et quas architecto ut eum repellat enim vel. Voluptas repellat unde nemo impedit magnam sit fugiat aut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...