(773) 763-6750

J. Chie, Esquire

Our law firm provides legal work for real estate closings for over 30 years… What distinguishes Chicago Commercial Appraisal Group from other appraisers is the level of thoroughness and details.

A. Raila, Senior Tax Analyst

Gary is a hands-on professional always willing to pick up the phone and work with you... His appraisal firm produces one of the best real estate forecasting reports in the state. I highly recommend his work and his opinion is highly recognized by governmental agencies.

J. Norris, Property Tax Attorney

As an attorney, we deal with many appraisal reports used in tax appraisals. Gary's work has proven successful for our clients and I do not hesitate recommending him for tax assessment appeal appraisals.

C. Noone, property owner

I needed an appraisal for settling an estate. Mr. Peterson was very professional, punctual and helpful with the process. I received my report ina timely manner. I would certainly recommend this company, as well as use their services in the future.

J. Tsiaousis

Gary is one of the top commercial appraisers in Chicago. Every time I have a client in need of a commercial appraiser I refer all work to him without hesitation.


<<< back< prevnext >

Small Commercial Property Owners Getting Hammered by High Assessments

Recently Crain’s published an article “Why some landlords shouldn’t gripe too much about the assessor’s new math.”  In that article Crain’s conducted an analysis of the 50 biggest commercial property sales in Northern Cook County and compared them to the assessed values.  They found that the assessed value of 11 properties exceed their sales prices; two were virtually identical; 6 were too difficult to analyze and the remaining were valued at a median of 19 percent below the sales price. In a subsequent Crain’s article “Kaegi: The embrace of a failed status quo makes no sense,” Mr. Kaegi reportedly sites the aforementioned analysis as evidence of the improving accuracy of assessments.

 

To me, Crain’s analysis would be analogous to looking at the income tax returns of Jeff Bezos and Warren Buffett, then concluding that based on their income taxes being low relative to their incomes, everybody should be happy with a reasonably fair income tax system.  In the meantime, their secretaries are paying double the effective tax rate than they are!

 

Cook County has something like 120,000 commercial properties.  By only analyzing the highest 50 sale prices, Crain’s is looking at less than a fraction of the top 1% while ignoring the bottom 99% of properties.  Is it a mark of a good assessment process that the wealthiest, best connected and most powerful in the County have more modest assessments? What about everybody else?

 

Chicago Commercial Appraisal Group just completed an analysis of 50 smaller commercial properties.  We looked at industrial buildings from 5,000 to 30,000 square feet that sold between June 1, 2017 and December 31, 2018, or within 18 months of the Assessor’s proposed values on January 1, 2019. The buildings were located in Elk Grove Village, Franklin Park, Melrose Park and Wheeling.  Properties that were obvious REOs, sale-leasebacks, auction sales or non-arm’s-length transactions were excluded.

 

Our results were strikingly different from what Crain’s found for the very largest commercial properties.  78% of our small building sample set had property assessments that averaged 58% higher (median 44% higher) than their purchase price within 18 months prior to the assessment.  In some cases, the assessments were over 200% higher than their recent purchase price. 18% of our data set had assessments that averaged 32% less (median 26% less) than their recent purchase price.  Only 2% of the industrial properties were assessed within 5% either direction of their recent purchase price.

1/1/2019 Assessment Level Relative to Recent Purchase Price

Small Industrial Properties




% of








# Properties

Data Set

Median

Average






2

4%

w/in 5%

w/in 5%






9

18%

-26%

-32%






39

78%

44%

58%






Our analysis was consistent with what we have seen with most property types for smaller properties over the past year. While the Crain’s article is correct that many property owners and tax attorneys will appeal every year no matter what, that doesn’t diminish the fact that most of the assessments are far above what these small buildings are actually worth.  The financial burden on small building owners is real.