Real estate tax bills can often include “direct” and/or “special assessments”. Examples of these can be sewer charges, flood control or development bonds. As an office or retail tenant, you need to look at each of these charges. Are these special assessment charges in agreement with your lease arrangement?

Tax expenses are typically a tenant’s second most expensive occupancy cost! NRTA’s Classroom LIVE helps professionals charged with handling property and real estate tax appeals and filings. This 4-course training series is scheduled to start Tuesday, November 16, 2021. Reserve your spot today!

Each tenant’s sewer charges are based on water consumption. If your landlord is billing a pro rata share of the total, you could be paying for more than your actual usage or more than what was applied to the actual building.

Bonds are indicated on a tax bill in several ways. There are bonds collected for newly developed areas covering sewer lines, as well as off-site improvements such as signal lights, sidewalks, roads, etc. Development costs for a shopping center should be a cost to the landlord for developing the shopping center, not the tenant! This bond collection can also occur in re-development situations.

Know the facts. It is important to be aware of what your tax bill assessments actually represent. Landlords have been found to charge significant development costs to the tenants in the form of “Special Assessments”. This occurs when, during the approval process for the shopping or office center, development costs normally paid by the landlord in their mortgage are segregated and treated separately. The landlord then negotiates with the local government authority to have these costs paid by a special assessment. Significant development costs have been transferred to the tenants via a “Special Assessment” tax. Known examples are ring roads, highway interchanges, access roads, and parking structures. In most cases there is a phone number on the tax bill that you can call for information. The information will be sent upon request.

Now The Fun Part! Roll Up Your Sleeves And Start The Assessment.