04-15-2009 Council Minutes - Laserfiche WebLink

Home Browse Search

MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. • 19. John Henrich, 4125 Highwood Road, PID 07- 117 -23 44 0084 Henrich stated his house was valued this year at $1.7 million and consists of .7 acres. The Assessor's Office used comparables located on Highwood Road and Casco Point, which is not reasonable. Henrich stated he did speak with the Assessor's Office and requested that they visit his property. The City Council requested the Assessor's Office review Mr. Henrich's property. 20. Dan Crear, 3701 Shoreline Drive, PID 20- 117 -23 210033 Crear noted his property is zoned commercial and that he believes his value is way out of line. The value on the property has escalated by 50 percent over the last four to five years. Crear stated he bought out his partners in 2007 for $500,000. Crear stated his property is currently valued at $600,000. He contested his valuation last year and went before the County Board, who reduced his valuation to $600,000. He has met with Josh Hoglund, who visited the property and has received all of his financial information. The building is currently at 50 percent occupancy. Two years ago it was at 100 percent occupancy. Crear stated Navarre needs a long -term plan to help revive the area. Crear indicated he is projected to lose $9,000 this year and that he lost $6,000 last year. Since he met with the appraiser approximately one month ago, he has lost three more tenants and that he was forced to • drop the rent on three others in an attempt to retain them. The property will be sold on value since it is commercial but was told by the appraiser that the best use is owner- occupied. Crear indicated this property will always have retail tenants even if it is owner- occupied. Crear pointed out he will lose money on the property. Crear noted if his valuation is dropped by $100,000, his taxes would only decrease by $1,500, which does not come close to making up his losses. . Crear stated one of the issues is the fact that the tenants do not have individual utilities. Gas is going up. Crear stated he has to pay all the expenses in the building due to the way it was constructed. The state agreed last year that it is an unusual property, hard to value, and hard to find comparables. It was built 28 years ago for approximately $650,000, and the value has not really changed. Crear stated it is unreasonable for Hennepin County to increase the value in a good market but then not reduce it in a bad market. Crear stated he will be appealing his valuation to the county. Hoglund stated he did visit the property and did an income approach to arrive at the valuation. Crear stated he was told by the appraiser that the property was worth $600,000. Hoglund stated the property did maintain its value from last year. Crear indicated he was told by a realtor that it went down 20 percent. Hoglund indicated the value of the property was undervalued last year based on the mortgage cap rate and other factors. Hoglund agreed that the vacancy rate is far above the other properties he has analyzed and as a result he utilized a vacancy percent of 20 percent. A potential buyer for the property would probably • use it as an owner- occupant property with a portion leased out, which is typical for a property this size. A potential investor is going to base his price on what is there. PAGE 10