San Francisco’s commercial real estate owners have been aggressively lobbying to lower their property assessments and tax payments in the wake of the troubled city’s declining real estate prices.
According to a Bloomberg report, Brookfield Corp. and Blackstone Inc. are among the companies filing for assessment cuts, and the level of requests have doubled in the three years since the beginning of the pandemic. Assessments for the city’s commercial properties for the current fiscal year went out in early July and new appeals are expected to increase prior to the Sept. 15 deadline for requesting reductions.
For the fiscal year that ended on June 30, an average 48% reduction on property assessed at more than $60 billion was requested, according to data from the city’s assessors office compiled by Bloomberg. Of the 2,420 appeals reviewed in the 12 months through June, about 55% received a reduction.
However, the savings for property owners creates a problem for a city that faces a $780 million budget deficit through 2025. Mayor London Breed’s latest budget is predicting the appeal process will result in the city refunding $167 million to property owners over the next two fiscal years.
“The assessments are going to be challenging, but we’re going to have to adjust to that – and wil will,” Breed said in an interview last month.