David Wolfe, Skoloff & Wolfe, P.C. co-managing partner, recently was a guest on The Morning Spotlight, a new podcast that tackles hot topics in the NJ real estate industry. The conversation centered on subjects relevant to commercial property owners in the age of COVID-19, such as being prepared with an action plan and experienced legal representation to defend against coming 2021 assessments.
“For ‘21 [COVID-19] is going to be first and foremost on property owners’ minds. Their income has been decimated. After January 1 most assessments are going to come out in New Jersey and other states, and property owners need to be prepared,” Wolfe told Mike Ham, the host of the Morning Spotlight program. “Property owners should have their team ready, and potentially their appraisals ready and they should be ready to go.”
Have a Plan for Your Property Tax Appeals
Wolfe expressed the importance of having a plan for every property owned, including evaluating, analyzing, and deciding whether or not to appeal. “Do not make the mistake in the state of New Jersey of just filing an appeal on every property. That would be an error. And it would be at your peril [if it’s judged that your assessment is too low].”
Wolfe added that Skoloff & Wolfe’s property tax practice area is not waiting and is already arguing for property tax reductions going into 2021. “Our clients hire us to screen every case and figure out whether or not there’s merit. Like the slogan before the 2020 election, ‘Make a Plan.’ Now is a good time to get ready.”
Tax Year 2021 will mark the first year in which taxing authorities will be forced to acknowledge COVID-19’s impact on property values. Many jurisdictions have refused to recognize the impact of COVID-19 thus far because 2020 assessments were established with pre-COVID-19 valuation dates. However, since values for Tax Year 2021 are based on post-COVID-19 valuation dates, taxing authorities are no longer able to ignore the pandemic’s impact on property values. As such, Skoloff & Wolfe property tax attorneys are anticipating a large increase in the volume of appeals, particularly in the retail, hospitality and office sectors.
According to Wolfe, property taxes are the largest and most variable expense for property owners. They’re also the most difficult to predict. For owners and investors, knowing how the local tax jurisdiction is going to behave can be the key to making or breaking their investments.
Property Tax Analysis is Crucial for Real Estate Investment Success
“We advise our clients that there is no substitute for actual market-based analysis and that generalities must be avoided. Failing to properly project or account for property taxes can single-handedly destabilize an investment thesis or destroy a business plan,” Wolfe said. “It is imperative to examine this issue early and base your investment conclusions on a real understanding of the individual market. And there’s no better time to get ready than right now.”
Interested in Learning COVID-19’s Effect on your Commercial Property Values?
Contact the property tax appeal attorneys at Skoloff & Wolfe to discuss a plan for your property tax appeal: (973) 992-0900.