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Suburban CRE owners feel 74% more pain after Kaegi valuation
By contrast, homeowner assessments in north and northwest suburbs to rise 16%
UPDATED, 12:31 p.m., Dec. 12: Cook County Assessor Fritz Kaegi has presented his initial property assessments, and business owners in the north and northwest suburbs predictably are not happy.
Kaegi’s assessments will shift a large portion of the tax burden off of homeowners and onto larger property owners. The Tribune reported that valuations for commercial, industrial and large apartment complexes will increase by 74 percent. By contrast, homes will increase by just 16 percent. The Tribune’s analysis found that under Kaegi’s new assessment, businesses would pick up 44 percent of the combined taxes in those suburbs in 2020, a 10 percent increase from this year.
The higher assessments on businesses did not land well with commercial property owners. An auto dealership owner in Evanston, for example, will take a big hit, with his total market value increasing from $14.1 million to $34.6 million.
“If these assessments stay, and these tax rates stay, I’m out. And me and thousands of other small business owners, we’re outta here,” Autobarn owner Fisher told Kaegi’s staff at the April event, according to the Tribune. Though Kaegi’s office rejected his appeal, the Board of Relief later reduced the value of his properties to $17.9 million.
Cook County community members are worried that the assessments have caused commercial property sales to slow in an already struggling market.
According to JLL, commercial sales in Chicago reached just $3.9 billion in the first nine months of the year, a staggering decline from the $12 billion in commercial sales logged in 2018.
The job Kaegi walked into wasn’t easy to begin with. The Cook County tax system has been riddled with inequities and political drama. It’s among the reasons taxes rarely have been increased to their assessed value. [Chicago Tribune] – Jacqueline Flynn
Correction: This story has been corrected to note the aggregate valuation for various asset types; a prior version mistakenly noted it was an average. Further, an earlier version attributed an auto dealership’s increased assessment as representative of all dealerships. The story has since been updated.