MENU
component-ddb-728x90-v1-01-desktop

CBJ Report: Cedar Rapids commercial properties see assessment increases

The new Intermec office building at 601 Third St. SE was reassessed 28 percent, or $1.77 million, to $8.11 million, potentially raising its property taxes $62,000 per year. (CBS2/FOX28)

Every week, the Corridor Business Journal shares stories it's working on with CBS 2 News. Here are some of their top stories that will appear in Monday's edition of the CBJ.

Cedar Rapids commercial properties see assessment increases

The first commercial property reassessments in four years came as a shock to many commercial property owners, who have seen double-digit assessment increases that ranged in many cases above 20 percent.

The GreatAmerica Building at 625 First St. SE was reassessed upward by 61 percent, or $9.6 million, to $23.7 million, potentially raising property taxes for the owner by $315,000 annually. A Culver’s restaurant at 2405 Edgewood Road SW was reassessed up by 39 percent, or $463,000 to nearly $1.65 million, potentially increasing its property taxes by more than $16,000 annually. And the new Intermec office building at 601 Third St. SE was reassessed 28 percent, or $1.77 million, to $8.11 million, potentially raising its property taxes $62,000 per year.

While those are some of the most dramatic examples, it’s clear that the reassessments could leave business owners feeling a pinch.

“This is a major hit,” said James Schmitt, owner of 380BizHub at 260 33rd Ave. SW. Mr. Schmitt is managing director of Expense Reduction Analysts, a firm that specializes in finding ways for its clients to reduce expenses. While his company doesn’t get involved in appealing property taxes, he has a personal stake in the reassessment and has helped mobilize commercial property owners to resist the higher assessments.

During the four years since the last assessment, City Assessor Betty Weeks said the data collected by her office has shown that prices paid for commercial property rose substantially and space vacancies have declined. She said the trends reflect the recovery from the flood and recession of 2008, and an increase in new construction, particularly in flood-recovering areas.

Marion considers filling $9.5M of 13 & 151 project gap

The city of Marion is queuing up a $9.5-million-plus incentive package to bring a 20-acre mixed-use development to the former Village Green driving range and mini-golf course at the northeast corner of Highways 13 and 151.

City Manager Lon Pluckhahn said the incentives are needed because of a funding gap that will result from plans to fully utilize the site by putting stormwater detention under the parking. The developer also faces large additional expenses in offsite transportation infrastructure, including improvements at the Highway 13/151 intersection, and traffic signals at two intersections.

Developer Brian Ridge's 13 & 151 LLC had originally sought a package including a 15-year TIF of 80 percent of the property's value with a total value of $13.47 million, a $2.5 million forgivable loan and $72,000 in city contributions to obtain a housing tax credit. The city is also being asked to support an application for a $1.5-million state RISE grant for transportation infrastructure.

As an alternative, Mr. Pluckhahn said the city proposed providing $9.5 million in support from a 12-year, declining-scale TIF tax abatement, and funding part of the amount in hotel-motel tax revenue that will reduce the need for borrowing on the project. The project is expected to include a hotel, which will add to the city's hotel-motel tax revenues.

The city is still planning to support the $1.5 million RISE grant and provide the tax credit contribution of $72,000, Mr. Pluckhahn said, and will participate in funding some of the offsite transportation improvements. The city's share of the total investment on the site, estimated at $35 million, would be about 27 percent, and Marion would gain a net $7.4 million in additional tax generated after the TIF rebates over 15 years.

The city's TIF rebates would be tied to the project's phases. Mr. Pluckhahn said the developer plans to do the offsite improvements in steps, with the intersection at the Culver's restaurant first, the intersection at 62nd Street second, and the 13/151 interchange improvements several years later.

Council members expressed no objections to the incentives at a working session Tuesday, and will consider acting on the request tonight.

Trending