HOW WE DELIVER / SUCCESS STORIES
Industrial Real Estate AppealFacts
- Reviewed the client's personal property filings in search of erroneously reported idle equipment, any functional and external obsolescence, and pollution control assets.
- Two industrial manufacturing properties in Macon, GA., were reassessed for the 2009 tax year. Thomson Reuters negotiated successful reductions on the subject sites in 2006, but the county increased the assessed values to pre-2006 levels.
- Each site had numerous buildings that were built over a period of several years.
- One site, a self-contained industrial campus with seven separate buildings, presented numerous functional issues. Along with the functional issues, the two facilities were only utilized at a fraction of full capacity.
- The Board of Assessors adjusted the assessments based on an initial appeal, but the values still overstated fair market value.
- The client engaged Thomson Reuters for further support, and the appeals were filed to the Board of Equalization. Informal meetings were scheduled and a property inspection was requested with county officials.
- Market knowledge, valuation experience, and a strong relationship with the county contributed to the favorable settlement. In the end, Thomson Reuters was successful in obtaining a $16.1-million reduction in fair market value, creating additional tax savings of $195,000. Over the estimated three-year appraisal cycle this project will yield a net present value well in excess of $500,000.
- Chemical plant in Gulf Coast area.
- Recent expansion of original 1970's plant.
- Appraiser valued equipment using standard cost approach.
- Functional obsolescence existed in previous generation technology due to excess operating costs.
- New production capabilities were overbuilt and the associated new product had not achieved the expected incremental margins.
- Competition from low-cost overseas production put plant at competitive disadvantage.
- Thomson Reuters prepared and presented to the county appraiser an obsolescence study that convinced the appraiser to change his assessment methodology. The consulting study updates and negotiations with the appraiser resulted in annual property taxes that are 50-70% less than they would have been had the appraiser continued to use its standard cost approach.
Telecommunications- Obsolescence ImplementationFacts
- Wireless provider deployed three separate technologies with migration of customers to successive analog/digital generations.
- Older equipment carried decreasing volume of voice and data traffic.
- Assessor valued personal property using a cost approach on a standard "Telco" table.
- Functional obsolescence existed in older equipment due to the higher capacities and faster data transmission rates of newer equipment.
- Based on an obsolescence quantification study and working with the local assessors in multiple counties, Thomson Reuters reduced the company's personal property liability by $1.5 million.