The current landscape of the U.S. office market is showing signs of significant distress, with over $38 billion in properties facing challenges—the highest since 2012. These conditions present complex hurdles for property owners and investors. As a property tax lawyer in New York City, I am closely monitoring these trends, especially the sharp decline in office loan payoff rates from over 90% in 2021 to just 35% now. This shift highlights the increasing difficulties in the market. Additionally, the upcoming year is set to see more than double the number of office loans maturing compared to last year, escalating the stakes for property owners. In my role, I advocate with New York City to adjust assessed property values to better reflect current market conditions, aiming to provide some relief to property owners during these turbulent times.
Benjamin Williams’ Post
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The new New York City property tax rates… for now. Rosenberg & Estis, P.C. blog: https://lnkd.in/eNn2q3Z6
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Have a store in New York City that was vacant on June 30th? You must report it by August 15th. It's a shame NYC still requires this filing, since they admit they don't use the data. I suggested to the City Councilperson that they end this filing requirement, but never got a reply. Webpage: https://lnkd.in/eide5yWe Guide: https://lnkd.in/eQRcYf8q
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The new New York City property tax rates and late payment interest rates for July 1, 2024 to June 30, 2025. I’ll post a link in the comments when my corresponding article is live.
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Please don't move out of NYC - the government wants your tax dollars. "A deepening housing shortage is costing New York City nearly $2 billion in annual tax revenue while driving residents out of the five boroughs and locking others into homes that don’t fit their needs, according to a new report released Thursday." https://lnkd.in/gcdBmYET https://lnkd.in/gP-d-5ws
A Building Crisis
cbcny.org
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The New York City Comptroller’s Bureau of Labor Law filed lawsuits against Planned Lifestyle Services and Planned Building Services — divisions of Planned Companies — for failure to pay prevailing wage and supplemental benefits to building service employees at two buildings receiving property tax tax benefits under Real Property Tax Law § 421-a. The owner of a residential building at 282 S. 5th Street in Williamsburg, Brooklyn with over 80 units, and the owner of a residential building at 546 W 44th Street in Manhattan with 280 units, both hired Planned Companies to provide services such as cleaners, doorpersons, and security guards at their respective buildings. https://lnkd.in/ecF6dMcV
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Bring back J-51 already. But please make it more generous and applicable to more buildings. And simplify the enforcement/penalties. "The city’s lawmakers and housing agency seem poised to reintroduce and pass a more affordability-focused J-51 tax program to help fix up apartments—but some housing stakeholders are lukewarm on the prospect." Christopher Janaro NYC Department of Housing Preservation & Development Pierina Ana Sanchez Kim Darga Tricia Dietz REBNY (Real Estate Board of New York) Jay Martin Barika Williams
City Moves to Resurrect Tax Breaks for Renovations, But Housing Stakeholders Are Split
https://citylimits.org
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Should the office to residential conversion developer include permanent affordable housing, in exchange for a temporary property tax reduction? 467-m “The massive facelift won’t come cheap. Berman estimates the Pfizer project will cost ‘hundreds of millions of dollars, but we hope to not hit $1 billion.’ And the extreme price tag seems to have shaped the business plan; all the apartments at the Pfizer site, which will not have any affordable housing, will be offered at market-rate rents. “Though state lawmakers this spring established a program to award property tax breaks for certain conversion projects in exchange for their making 25% of units affordable, some developers are skeptical that those projects can be financially sustainable even with the abatements. “Pfizer appears eligible for the city-administered program because it’s in a central Manhattan neighborhood, will have broken ground after 2023 and will wrap up by 2039. But Berman has questions about how affordable units could stay that way permanently. “‘We’ve never had a situation where tax breaks burn off, but you have the affordable units forever,’ he said. ‘It’s a package that needs to be evaluated.’ Berman said he is not counting on the incentives to get Pfizer across the finish line.”
Former Pfizer HQ apartment conversion to kick off this summer
crainsnewyork.com
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“Event-planning firm Rose Group, which operates the uptown venue 583 Park Ave., has sued its landlord, Third Church of Christ Scientist, for an alleged scheme to cancel a major tax break at the Upper East Side property. “Rose, which hosts high-profile galas for hospitals, environmental organizations and civic groups, had been paying about $160,000 a year in taxes for its part-time operation of the nonprofit site, which it has leased since 2006. Rose's lease appears to be the "single net" landlord-favoring kind that requires the tenant to be on the hook for the property taxes and not the owner. “But after a move [allegedly] coordinated by church officials, the city’s Department of Finance in May revoked the tax abatement covering a portion of the religious property. The change means Rose Group is now on the hook for a much-steeper $799,000 property tax bill. “The suit, which was filed Tuesday in Manhattan Supreme Court, seeks $3.5 million in damages, interest and attorney fees.
Embattled event space 583 Park sues church landlord over lost tax break
crainsnewyork.com
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Court Upholds HPD's Tax Exemption Denial for Condo Brooklyn Developers In the case 511 Lafayette LLC v. Louise Carroll, Commissioner of NYC Housing Preservation & Development (2024 NY Slip Op 32003(U)), the Supreme Court of New York County, under Judge Arlene P. Bluth, upheld the denial of a property tax exemption under Section 421-a of the Real Property Tax Law. The petitioners, owners of three Brooklyn properties, argued that their projects met the criteria for a specific exemption ("Homeownership" Option D) which did not require affordability for certain homeownership projects. However, the Court found that the projects did not comply with the "replacement ratio" requirement, mandating affordable units to replace demolished ones. Judge Bluth emphasized that the statutory requirement applies to all eligible sites, including those seeking benefits under Option D. The ruling highlights that developers must adhere to the replacement ratio, even if it necessitates combining condo and rental units, however inconveniently. Additionally, Judge Bluth noted the nearly four-year delay in resolving the case, acknowledging the court system's role in this "absurd and unacceptable" delay.
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