Amari & Locallo e-letter
May 2015
Amari & Locallo
Chicago Office
734 N. Wells Street
Chicago, IL 60654
312-255-8550
Amari & Locallo
Bloomingdale Office
236 W. Lake Street, Suite 100
Bloomingdale, IL 60108
630-307-3700

When to consolidate...

 

Last month we talked about whether owners of real estate should consider a division (dividing one parcel into many) in an effort to keep real estate tax as low as possible. We concluded that it was not always to the taxpayer's advantage to divide. Knowing that an assessor usually views a parcel that has mixed-use "as all one kettle of soup" the economies of scale can be favorable. Income, expenses and most important occupancy percentages from differing sources (retail and office) could support one another in a lower assessment and a lower tax.

 

In assessment parlance joining many parcels into one is known as a "consolidation".   But, despite what we just said in last months article it is not always to the taxpayer's advantage to consolidate.

 

Property with separate office and retail parcels can determine more accurately for their tenants the contribution of office versus retail to common area maintenance, real estate tax and other expenses. 

Negotiating leases for a particular space is made easier also knowing what to expect from the Assessor.

 

Because office and retail tenants draw from different markets, their income, expense and occupancy summaries differ.  Overall income, expense and vacancies percentages are easily separated to determine a net operating income upon which a reasonable capitalization rate can be applied in determining a market value. Keeping office from retail separate allows the Assessor to apply different industry standards to carry their assessments.

 

To divide or consolidate turns out to be a coin with two heads seeking similar results but having different considerations along the way. Seeking the most reliable path to a lower tax bill should always be traveled, and whether you have one PIN or several, the main focus should be on reducing the overall market value to achieve the lowest overall tax possible.

 

Let us help you determine the most advantageous means of lowering your assessment.  Give us a call.

About Our Law Firm 
The concentration of the Law Offices of Amari & Locallo, with offices in Chicago/Cook County and Bloomingdale/DuPage County, is representing commercial, industrial and multi-unit residential property owners throughout the State of Illinois. Our personnel have experience as county tax assessors, corporate tax managers, trial lawyers and real estate transaction attorneys, which contribute a unique insight into the negotiation and process of appealing real estate taxes. 
Partners


 

Our comprehensive knowledge of real estate tax laws 

and procedures enables us to effectively represent the interests of our clients throughout the State of Illinois.


 

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For additional resources and more information about the assessment process, visit our website!