Printer Friendly

City values up over 6%.

Hotels have been kicked up again, and so have some major-office towers. Small homes have risen the most since 1991. And there's a report of a West Side apartment building with a 62 percent rise for no rhyme or reason, although the average market value for Class II properties was 7.96 percent.

The tentative Fiscal Year 2000 property tax roll has good new for outer-borough and non-core properties, which have for the most part been left unscathed, but certiorari attorneys warn the city's taxing policies still might make those properties over-assessed.

Despite 1998's sales prices rivaling and even exceeding some of the 1988 levels, the Department of Finance has stuck to its stated policy of setting values based On income and expense formulas. But since the administration years ago cut the personnel and division that was reviewing the required filings, sources say that limits those reviewed in detail to high values and target areas.

That's a plus for fringe neighborhoods where multi-family residential owners are Still subject to rent regulation and the low incomes of their renters, and where office and retail rents never come close to matching Midtown's leading prices.

According to information released by Finance Commissioner Alfred C. Cerullo III on January 15th, the market value of taxable property rose 6.17 percent over last year to $330.6 billion. The moderate increase is a reflection of 1997 incomes, the Giuliani administration's policies of encouraging business growth, and its good relations with the real estate industry. Last year's tentative values rose 4.87 percent and was based on 1996 incomes,

It was the Dinkins administration's inflexible policy of setting assessments based on 45 percent of inflated sales prices, and then its stubbornness at maintaining the high assessments - even in the face of arms length transactions at vulture prices - that led to so many foreclosures when the low rents and large vacancies in places like Downtown Manhattan could not cover the high taxes.

This year, the surging city economy and market values of certain properties are only somewhat captured by the tentative fiscal year 2000 property tax roll.

Finance has tentatively set the total billable assessed value of city property at $81.6 billion, up 4.98 percent. By contrast, the tentative FY 1999 roll was set at $78.6 billion, and after challenges, the final billable assessments totalled $77.698 billion, still up from final billables of $76.020 billion for FY 1998.

Some sample transition assessments for property on the privatization list include Governor's Island, unchanged at $84.15 million, and the World Trade Center at $878.85 million, up from last year.

Tentative transition assessments for other prominent city property are: the Met Life Building at 200 Park - $247.3 million; the Empire State Building at $190.26 million, which is up slightly; the Solow Building at 9 West 57th Street - $127.26 million; and the Waldorf-Astoria at $131.85 million.

In many cases, actuals are up dramatically, showing the future trend, but transitions are still lagging.

Property owners pay taxes on the lower of their actual or transition assessment. In a rising market, the transitional assessment tends to lag the actual, and helps phase in increases in tax payments.

Confident of the enormous gains in income posted by the city's hotels, Finance has once again boosted the market value of hotels, this time by 17 percent. This comes on top of three previous years of market value gains totalling 34 percent.

Tax certiorari attorney Isaac Sherman, a partner with Sherman & Gordon, stressed the city is continuing to adhere to a claim that the commercial and multi-family classes are being assessed at 45 percent of what they estimate to be the full value.

"Most observers believe that unless the city comes forth with evidence of how they derived those values, the observations of the market seem to indicate that that ratio is not correct, and therefore, many property owners are going to be hurt by being unable to challenge their assessments effectively with this artificial ratio," Sherman said. "It's a question of the city being candid with the taxpayers, rather than just announcing a ratio number and believing it to be sacrosanct when it doesn't represent a real careful analysis of how they arrive at that number."

The effect on the tax roll, Sherman continued, is that the city is under-valuing certain properties and over-valuing others, because there are still wide disparities between the ways they derive the assessments.

"The under-valued properties are not being provided with an effective way to challenge their assessments," he added.

The FY 2000 roll becomes final in mid-May, and it is on those figures which July 1999 tax bills will be based.

Owners may challenge the tentative assessments by requesting a timely review by Finance, which can also result in an increase in assessment, or by filing an application with the Tax Commission. Owners of Class II multi-family buildings, Class III utility property and Class IV commercial property have until Monday, March 1st to file their Tax Commission applications. Class I single-family homeowners have until March 15th.

Applications to obtain the School Tax Assessment Relief (STAR) benefits for home and co-op/condo primary resident owners may be filed until March 1, 1999.

Taxpayer assistance is available through (718) 935-9500 during office hours, while Tax Fax forms can be obtained at (718) 9356114 24-hours a day, and the Department of Finance forms and information can be researched on the web at www.ci.nyc.ny.us/FINANCE.
COPYRIGHT 1999 Hagedorn Publication
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1999, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:New York City property values
Author:Weiss, Lois
Publication:Real Estate Weekly
Article Type:Brief Article
Geographic Code:1U2NY
Date:Jan 20, 1999
Words:917
Previous Article:PWC forum looks at roads and rails to planes.
Next Article:Rudin breaks ground on Reuters HQ in Times Sq.
Topics:


Related Articles
Tax consequences of solution transactions.
'How'm I doin?': a review & request.
New tax reduction strategy required.
Challenging 1993-94 tentative assessments.
Transfer taxes apply to cash poor too.
Manhattan residential market 30 percent ahead of '80s peak.
Parking facilities are good place to make first impression.
Neglia Appraisals launches website offering real estate trends.
Commercial RE market creeping towards recovery in 2002.
Second quarter holds promise of good, bad and ugly.

Terms of use | Privacy policy | Copyright © 2020 Farlex, Inc. | Feedback | For webmasters