Perhaps commercial property owners will soon be paying their fair share of property taxes if this news from the Dallas Central Appraisal District is any indication.
Last June, I reported that HEB owned a block of Lemmon Avenue between Reagan and Throckmorton Streets that was to have been a new Central Market. Those plans shifted to a more ambitious project at Lemmon and McKinney Avenues. However, DCAD had already planned on the Reagan/Throckmorton block being developed and had gutted the block’s assessed values (as they routinely do prior to development).
Each of the four townhouses was valued at $1,000, while rating as “very good” or “excellent.” The land the four sat on was also not reflective of market rates. Net-net, each of the four had three years where they were valued at less than half their 2015 market rate. While you and I likely got walloped with large increases, multi-billion dollar HEB benefitted from DCAD’s shoddy benevolence.
It’s nice to know DCAD reads CandysDirt.com, because things changed for 2019’s proposed valuations.
In 2015, 3929 Bowser was valued at $331,220 before spending the next three years assessed at $141,950. The property’s 2019 proposed valuation is $427,140. For 3520 Throckmorton, 2019’s proposed valuation is $456,750. Neighboring 3516 Throckmorton sees a 2019 proposed valuation of $464,100. Rounding out the four townhouses, 3512 Throckmorton’s proposed 2019 value is $388,920.
Are even these valuations fair?
For 3512 Throckmorton, after three years of paying a third of their 2015 valuation, the proposed 2019 valuation is a jump of $132,200 or a 34 percent increase. For 3516 Throckmorton, the valuation jump was $125,970 compared to 2015 or 27 percent. At 3520 Throckmorton the increase was 19 percent or $87,000 since 2015. Finally, 3929 Bowser is valued at roughly 22 percent or $95,920 higher than it was in 2015.
Cutting to the chase, four townhouses build simultaneously to the same construction and aesthetic standards – that are physically connected to each other – saw their valuations raise between 19 and 34 percent. How is a 15 percent spread justified?
HEB has hired Popp Hutcheson to challenge the valuations on all four properties. A hearing date of June 26th at 1 p.m. is already set.
Oak Lawnians, how much has your assessed value increased since 2015? Was it between 19 and 34 percent? More? Less?
For reference, my Pink Wall condo’s 2019 proposed assessed value increased $104,450 or 34 percent in a single year. Since 2015, it’s up 58 percent, and since I purchased in 2013 it’s more than doubled. My increases have been so rapid, I’ve hit the homestead cap every year but one.
La Madeleine: The Other End of the Block
But you will recall there were two parts to that story. Also on the HEB-owned block is a commercial building fronting Lemmon Avenue housing La Madeleine. That building is 17,360 square feet and rated as being in “good” condition by DCAD. Its tax situation is a little more of a shell game.
At first glance, the proposed 2019 valuation for the building alone zoomed from $66,610 to $756,510 – call it a 12 increase in value (a good start). But as the building rose, the land dropped by $520,960 leaving a total rise of just $168,670 or 7.5 percent year over year. Like the townhouses, HEB has a hearing date with DCAD to challenge the valuation.
My original column compared the 1985 La Madeleine building with the Pet Supermarket built in 1971 across the street. You’ll (not) recall that Pet Supermarket’s building is 10,000 square feet smaller than La Madeleine’s 17,360 square feet – in addition to being 14 years older. While both are assessed at the same rate per acre for their land, the building valuations remain wildly out of synch.
In 2018, the Pet Supermarket building’s assessed value rose from $969,850 to $1,112,500. This year it’s up again to $1,434,500. In two years, they’ve seen a 50 percent increase in building value and a $322,000 increase in value this year alone.
Net-net, Pet Supermarket’s 10,000-square-foot smaller building that’s 14 years older than the La Madeleine building has seen increases to its building of 50 percent. Meanwhile, even though La Madeleine is 10,000 square feet larger and 14 years newer, it’s valued by DCAD in 2019 at $677,990 less than Pet Supermarket.
It’s nice to know DCAD reads CandysDirt.com, but I wish they’d read to the end of the page.
Remember: High-rises, HOAs and renovation are my beat. But I also appreciate modern and historical architecture balanced against the YIMBY movement. In 2016, 2017 and 2018, the National Association of Real Estate Editors recognized my writing with three Bronze (2016, 2017, 2018) and two Silver (2016, 2017) awards. Have a story to tell or a marriage proposal to make? Shoot me an email email@example.com. Be sure to look for me on Facebook and Twitter. You won’t find me, but you’re welcome to look.