Protesting property taxes for commercial office property

[Travis Reed]

With the uptick in cap rates, shouldn't everyone be protesting your county tax property appraisals to reflect lower tax values this year?

Here in Texas, my county is really trying to screw me. For my commercial office, they are trying to raise my taxed value from 360k to 880k! I plan to protest the heck out of this!

My method for protesting commercial is to apply the appropriate cap rate to my pro forma NOI for 2023. I am going to attempt to claim a 10% cap rate, against a NOI that incoudes expenses like 10% rent loss, 12% property management, 8% repair budget, 5% capx, and the typical tax, insurance, landscaping, etc. Does this seem reasonable? Anyone with experience on this? I am curious what values they will try to argue. My pro forma with all of these values actually shows the building to be worth $161k haha. In other words, they proposed a 2.5x increase and my counter is to ask for a 50% decrease.

[Malcomb Stapel]

@Travis Reed go fight the good fight brother, and best of luck to you! I had to schedule an hour and a half appointment with my county appraisers to get through the stack of them that we protested. I still have three of them to take to the next level of protest since they didn't want to budge. Keep in mind, your county may not need to use reason, logic, and or actual valuating best practices to come to their numbers. Definitely anchor them low, then make them drag you to the number that is reasonable.