1. The Corporate Taxpayer’s
Guide To Minimizing
Commercial Property Taxes

2. 2
In fact, commercial real estate plays such an essential role in the current economy that it’s been
named as a fourth asset class, along with stocks, bonds and cash.
A myriad of property owners nationwide have portfolios containing manufacturing, office, industrial,
retail, flex, multi-family and other types of commercial real estate. Enterprise corporate portfolios
might contain hundreds of assorted properties, while a small family-owned business might only own
a few buildings necessary to deliver their goods and services. Regardless of size, they both have the
same endgame in mind — to generate a profit.
What else do the buildings of mega corporations and small business owners have in common?
Property taxes: the only tax that requires expertise that your
CFO, controller and CPA all lack.
Commercial property taxes are an unavoidable reality for all
commercial property owners, no matter the type or number
of buildings they own.
So what? Everyone pays property taxes. Why is this a concern
to me and my business?
Here’s why: Property taxes are the largest cost — more than 40 percent — of corporate occupancy.
They are the largest state/local tax a corporate owner pays. And more than 90% of commercial
property owners — big corporations, investors and small business owners alike — overpay their
commercial property taxes each year.
This e-book highlights the steps that commercial property taxpayers must take to decrease the risk of
overpaying their property taxes and protect their bottom line.
Part 1 describes why aggressive and proactive commercial property tax management leads to year-
over-year real property tax savings. Part 2 explains how to win commercial property tax appeals and
achieve property tax savings.
Let’s put the commercial real estate market into context:
It’s a $217 trillion global market, an amount 2.7 times the global
gross domestic product (GDP). In the United States, the real
estate market constitutes 13% of the annual GDP.
$15 trillion:
Size of the U.S. commercial
real estate industry

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Part 1:
Commercial Property Taxes And You
Who’s Watching Over Your Commercial Property Taxes?
Depending on your company’s size and organization, the
responsibility for commercial property taxes could fall into
just about anyone’s lap. A small business owner may take
direct responsibility for reviewing assessments and paying
real estate taxes, but it can be harder to delegate this
responsibility in a large enterprise company.
Generally, anything related to taxes lands on the desk of the
CFO or the controller, or on the desk of one of their direct
reports. This makes sense until the CFO and his or her
team realize they lack the expertise to manage property tax
assessments, which are based on the market value of the
assets and not corporate financials.
Sometimes corporate real estate executives or facility
managers will receive the property tax assessments, but
again, these individuals lack expertise in market value.
The tax department is another logical resource, but they
face the same problem as the CFO – the lack of expertise
in figuring out market value, the basis of commercial
property taxes.
Regardless of who’s in charge, most companies deal
with commercial property taxes the same way: When
the bill arrives, it’s sent to accounts payable, as long as
the increase is “reasonable.” Taxes are paid and everybody waits to repeat the process next
year. Scrutinizing and mastering the valuation of commercial property – the basis of these tax
assessments – is time-consuming and just one more thing to add to someone’s to-do list.
What’s wrong with this picture?
First, property taxes are based on assessments that, by law, must reflect the fair market value of
the property. If CFOs and others in charge of corporate real estate (CRE) don’t know what their
individual properties are worth from a tax standpoint, they will need help.
Second, commercial property taxes are not a fixed business cost. The CRE market is never static;
property values are always increasing or decreasing. Therefore, property tax assessments
shouldn’t be static, either.
90%:
Percentage of commercial
property owners overpaying
commercial property taxes

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The Truth About CRE In America
Over-assessment of commercial property is common in the
United States, because taxing jurisdictions are mandated by law
to use mass appraisals for property tax valuation. While mass
appraisal is efficient, assessors don’t have the benefit of time
to consider properties as unique and individual assets with
specific market values.
In a jurisdiction with tens of thousands of properties,
mass appraisal is the only practical way to assess property
tax value. The sheer volume of properties in any given
jurisdiction prevents the assessor’s office from looking at
every asset individually. This means that variables specific to a
property, such as obsolescence exhibited by deficiencies and
inadequacies, aren’t factored into the tax value assessment.
Most taxing jurisdictions operate under an information and
resource deficit. Without the resources to measure all forms of
depreciation or the funds to pay for expensive real-time market
subscription data services, jurisdictions simply don’t have the
time or tools to determine the true tax value of every property.
Overall, property tax assessments aren’t immediately reactive
to the CRE market. In some extreme cases, jurisdictions without
mandatory reassessment schedules have not lowered property taxes since before the U.S. economy
crashed in 2008, despite significant changes up and down during that period.
While no jurisdiction in the United States was insulated from the Great Recession, during which
commercial property values dropped around 40 percent across the nation, the market has recovered for
many property types. In the years following the recent recession, the price of some property classes rose
18% above the pre-recession prices of 2007, and are now poised to level off or even start to decline again
as supply starts to exceed demand.
By taking a strategic, knowledge-driven approach to your commercial property portfolio, you’re able to
achieve real property tax savings through property tax appeals and abatements.
The Current And Future State Of Corporate Real Estate
According to a Forbes survey of 201 senior executives from corporate real estate management
companies, brokers, investors, financing executives and attorneys, “more than half, 52%, of respondents
believe that their segment of the market is either strong or very strong.”
Going forward, experts predict changes in two areas. First, as the industry continues to recover from the
lows of 2008 and 2009, technology will play an increasingly important role in the future of commercial
real estate. A number of trends are easily identified, the foremost being a digital-dependent and real-time
marketplace.
Property taxes are the largest
cost — more than 40 percent
— of corporate occupancy

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This is evidenced in many ways as corporate owners try to right-size their portfolios based on
changes in their workforce and their customers. Our workforce is now mobile and no longer
showing up to the office every day. Companies like Amazon and Tesla have changed customers’
expectations and challenged the way we do business.
The other area of change is the fundamental business model. John Clark, a program director at
IBM, partnered in a recent CRE study with the firm CFO Research. He concludes that business
fundamentals are shifting.
“The business agenda has shifted. We have exited the era of cost containment and cost
reduction,” Clark said in an article in CoreNet Global’s magazine, The Leader. “A majority of
organizations are now fueling up for growth in their respective industries, and I think that brings
a new set of challenges for corporate real estate.”
The challenges Clark alludes to include preparing for growth and the continuing pressure to
cut costs. Managing commercial property taxes directly impacts both challenges, and proactive
management can help ensure success.
A Failure To Be Proactive
Most businesses aren’t proactively managing and appealing their commercial property taxes. This
results in consistent property tax overpayment, with the average U.S. company overpaying its
commercial property taxes by 31%.
If your organization is just cutting a check to the jurisdiction and sticking it in the mail every year,
you are potentially overpaying hundreds of thousands of dollars (if not more) and paying more
than your fair share.
Adding more properties to your commercial real estate portfolio only increases the pressure to
cut costs. Savvy executives take advantage of every opportunity to negotiate the best possible
deal, but their due diligence rarely includes an analysis of property taxes as the largest cost of
occupancy.
However, commercial property tax savings don’t just appear. It takes time and resources to
investigate and figure out what your property tax assessment should be. You’ll also need fluency
in a complicated, quasi-legal, deadline-based commercial property tax appeal process. Plus, if you
own property nationwide, you’ll need an intimate understanding of the requirements of each of
the local taxing jurisdictions involved.
If it sounds hard, that’s because it is. But appealing and reducing commercial property taxes is a
possibility for nearly everyone.

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Not All Property Tax Management Is
Equal
There’s managing commercial property taxes, and there’s
managing them well.
Even among businesses that do manage their property
taxes (or outsource the task), missed savings opportunities
are common.
For example, a 1-million-square-foot manufacturing facility
near Dallas shaved about $20,000 off its tax bill. While that
was nice, imagine how the owners felt upon learning they
could have saved significantly more. After partnering with
RPTA’s property tax management team, the manufacturer
secured an additional $60,000 in tax savings.
In 2014, when the oil and gas markets plummeted due
to oversupply, many industry suppliers faced a financial
bind. A major Midwestern steel manufacturer that makes
parts for the industry engaged RPTA to manage its real
and personal property assets as part of an overall cost
reduction initiative and reorganization in the wake of the
fallout.
The county assessed the manufacturer’s property at almost
$40 million. RPTA’s internal valuation of the real estate came
to $27.5 million for three plants, totaling 4 million square
feet of space. An additional independent appraisal came in
at $27.7 million. RPTA’s testimony to the board of assessors
in 2016 resulted in their confirmation of taxable value at
$27.7 million.
The client received almost $300,000 in tax refunds for
the first year. The agreement also stipulated that the value
would be adopted for the next three-year assessment
period, securing another $900,000 in savings, for a $1.2M
reduction in operating expenses.
Part 2:
How To Minimize Commercial Property Taxes
31%:
Average U.S. commercial
property tax overpayment

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Huge Savings Hide In Other Properties
About 90% of average U.S. commercial properties are over-
assessed. It’s likely that if you have one property to appeal
in your portfolio, you have others. Don’t fail to identify
potential savings on all of your properties.
For example, let’s say your property portfolio contains
43 assets. If you win commercial property tax appeals on
your three biggest properties and stop there, you have not
maximized your potential property tax savings.
Here are some key points to remember whether you’re
managing commercial property taxes on your own or hiring
a professional firm to manage your portfolio on your behalf,
year-after-year.
1) Look at the entire portfolio: Truly successful
commercial property tax management takes the entire
portfolio into account to eliminate risk. It’s tempting to
cherry-pick top-dollar assets and spend the most time
managing those, but effective commercial property tax
management strategies encompass the entire property
portfolio.
2) Review your portfolio annually: Change is inevitable and often affects the tax value of
commercial property. The occupancy of an office building in your portfolio could decrease by
20% in a year. Or perhaps you built your headquarters as a highly specialized property to meet
your company’s needs, knowing you will never recoup your cost because no one else will ever
need a property like this. In both cases, there are legitimate arguments, supported by data and
value analysis, that justify the reduction of the assessed value, resulting in tax relief for you.
3) Not every property is worth pursuing: While it’s essential to examine the tax value of each
property in your portfolio annually, you don’t necessarily need to take action on every asset.
Occasionally, taxing jurisdictions unwittingly under-assess a property. In such situations, there’s
an implied savings and you should keep quiet and pay the bill.
Remember, when you file an appeal, both parties have the right to review the current
assessment, which could lead to the risk of a higher assessment. You can manage that risk by
knowing the market, the law and the quirks of the jurisdiction.
4) The law is on your side: Local taxing authorities are obligated to tax you fairly, but they’re
not obligated to help you determine if you’re being overtaxed. Remember, state law states
that you don’t need to pay more than your fair share of property taxes. When you add a solid
presentation of your argument, supported by research and data, it’s hard for a jurisdiction to
deny the merits of the appeal.
Truly successful commercial
property tax management
takes the entire portfolio into
account.

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The Nuts And Bolts Of Property Tax Appeals
To know if you should file a commercial property tax appeal, start by determining whether your
property has been assessed at fair market value of the fee simple interest.
This means establishing whether the local tax assessors have
assessed your property as if it were available on the open
market for sale or lease as of the lien date (usually January 1).
What’s key is fair market value of the fee simple interest. With
few exceptions, commercial property tax assessments are
calculated based on an analysis of comparable sales to derive
a sales price per square foot, or using a market rental rate
determined by current deals.
Calculating the fair market value of the fee simple interest
takes quite a bit of effort and research. The taxing jurisdiction
should go through this process each time your property tax
value is assessed, but that doesn’t always happen.
Unfortunately for property owners, determining whether a
property is properly assessed requires more than making a
phone call. You’ll need to do your research, gather data from
multiple sources and verify transactions in order to determine
whether the current assessment represents fair market value.
If your property is not assessed at fair market value, you’re in
a position to file a commercial property tax appeal.
How To File A Commercial Property
Tax Appeal
Before you prepare to file a commercial property tax appeal, examine the weaknesses in the
jurisdiction’s assessment by reviewing the assessment notice and the county record cards. Design a
strategy to tackle each weakness and position your data as the correct value. Don’t file an appeal if
you’re not confident that you’ll win.
Filing an appeal requires accuracy and strict adherence to tight deadlines. Begin by getting the
critical due dates for each property and jurisdiction onto your calendar.
Next, you’ll have to collect more information from the jurisdictions where you’re appealing. Start by
finding answers to these questions:
• When is the deadline for appeals?
• Are you required by law to engage an attorney or an appraiser as part of the appeal process?
• Do you have the option to file your appeal electronically?
• What must be included with your appeal in order for the jurisdiction to accept it?
18%:
Percentage that current CRE
prices have risen over
pre-recession 2007 prices

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Once you’ve filed an appeal, ensure you have proof of receipt so you know the jurisdiction
received your documents on time. This is critical, because jurisdictions will reject your appeal if it’s
even one second late or filed incorrectly. You must be able to prove your documents were filed
on time, because there is no forgiveness in property tax appeals.
Also, make sure you know whether the jurisdiction requires an appeal to be postmarked by a
certain date, or whether it must be received by a certain date.
Once you’ve filed an appeal, the work’s not over. Here are the next steps:
1) Be ready to collect more data: After you’ve filed
the appeal, appoint someone to follow up with the
jurisdiction regularly to determine when your hearing
date will be. Find out if or when the jurisdiction will
request additional data from you.
Don’t underestimate the amount of data a jurisdiction
will ask you for or how frequently they’ll request the
same information. It may take you days to compile the
data for one request. If you have multiple appeals, make
sure your team is prepared to handle a large influx of
data requests.
Additionally, don’t simply collect and hand over the
data that’s asked of you. Never give more than the
jurisdiction asks for, unless it further supports your
case. Everything that you send is evidence, and you
don’t want to give the assessor anything that can be
used against you. Present your data in the way that’s
most advantageous to your case.
2) Stay in the loop: Manage your appeal to ensure
it’s being processed. Sometimes tax appeals are
submitted on time and then languish within the
assessor’s office for months, or even years. Have
someone check in with the assessor periodically to
track your appeal. After you’ve confirmed that your
appeal is moving through the system, find out whether you’ll be able to negotiate your appeal
informally or whether you will have to appear before a board hearing.
3) Prepare for the hearing: Tax appeal boards typically consist of three to eight officials
assigned to hear your case against the local taxing authority. In almost every jurisdiction in the
United States, you’ll only have 15 to 30 minutes to make your case. That’s not a lot of time. What
are you going to say? How are you going to say it? What’s your strategy?
One effective strategy employs the KISS principle. KISS is an acronym for “Keep it simple,
stupid,” and it serves you well when appealing commercial property taxes.
Prepare for the hearing.
In most jurisdictions in the
United States, you’ll only have
15 to 30 minutes
to make your case.

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Prior to attending the hearing, find out the jurisdiction’s protocol – is the format simple, with
each side presenting its data and conclusions? Or is it a quasi-judicial format, with the hearing
recorded, and strict rules for the order of presentation, cross-examination, rebuttal and closing?
Go to the hearing with a case fully prepared, but highlight the two or three most important points
in your case and reemphasize them as often as possible.
In advance of the hearing, find out whether you’ll have the opportunity to cross-examine the
appraiser and whether the appraiser will be questioning you. Think about the questions the
appraiser will ask you and prepare your responses thoughtfully. Review the assessor’s evidence
and prepare to ask effective questions. You, as the taxpayer, have the burden of proof, so you
must have an in-depth understanding of corporate property values, value influencers and the tax
law.
The best possible outcome after a hearing is for the taxing authority to accept your tax value. In
this case, you leave with the confirming paperwork and the jurisdiction sends a tax refund check or
credits your tax bill.
But you may not receive the results of your case the same day you make your argument. Once
you’ve presented your case, be prepared to follow up – aggressively if necessary – with the
jurisdiction. This is your money, so do what’s necessary to get it back where it belongs.
Playing Hardball
After the hearing, you may not be satisfied with the
results. At this point, you may need to take your case to
the next level, generally a court of law. Always vet your
team to make sure there are no conflicts of interest with
the opposing side.
You won’t necessarily be going to court and battling it out
with the taxing authority. The courtroom is the last resort
in a property tax appeal; when a property tax appeal
goes to court, nobody wins. But sometimes you may
need to hire an attorney and file for litigation to make it
clear that you’re serious about your case. Don’t be afraid
to fight for what is right.
As you see, a successful commercial property tax appeal
isn’t as simple as walking into the assessor’s office, telling
them you think you’re over-assessed and walking out with a
refund.
Local taxing authorities are
obligated to tax you fairly,
but they’re not obligated
to help you determine if
you’re being overtaxed.

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Keeping Property Taxes Minimized Year After Year
With good data analysis and honed presentation skills backing you up, you are well positioned to
win a commercial property tax appeal.
However, by now you’ve probably gathered that it takes a lot of time, planning, resources and
commercial property tax knowledge to successfully make your case and win.
In the business world, it makes sense to focus on what you do best and to outsource business
functions that are not your expertise.
Just as businesses rely on outsourced services for payroll, IT, HR and facility management, it
makes sense for you to consider saving money and time by outsourcing your property tax
management to qualified property tax consultants.
If you explore options for professional property tax management, look for a consultant who
has success with clients similar to you and whose success is built on transparency, client
communication and valuation expertise. You want to avoid a consultant who will simply cherry-
pick through your portfolio for the biggest and easiest properties to appeal. Find a partner
dedicated to providing an aggregated service, one that looks at your entire commercial property
portfolio year after year and eliminates the risk of higher property taxes hitting your bottom line.
The best commercial property tax consultants know this game is a marathon, not a sprint. Align
your organization with a consultant who understands the system and is willing to put in the hard
work necessary over time to earn you the maximum property tax savings.
Avoid partnering with anyone who lacks actual valuation expertise in real and personal property.
You need someone with a proven record of winning appeals and experience working with taxing
jurisdictions in all 50 states, and who has a documented process to manage multi-state portfolios.
This expertise is critical; it is not a good sign if your consultant calls you the day before an appeal
is due and asks for a mountain of documentation required to be filed with your case.
11

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575 Pharr Road | P.O. Box 52846 | Atlanta, GA 30305
Toll-Free: 1-866-816-2244 | 404-816-2050 | info@realpropertytaxadvisors.com
www.realpropertytaxadvisors.com
Act Fast To Avoid Paying More Than Your Fair Share
» Contact RPTA Today To Fight Your Property Tax Increase
Final Thoughts
It’s easy to think that successful property tax management is like stepping into the ring and
winning a fight. It’s an effective simile, but its sentiment is misguided. Property tax assessors are
not your enemy – they just lack the resources, time and data to be truly on your side.
If you’re able to provide tax assessors with data they don’t have access to, or information they
don’t have the time to collect, it is a matter of convincing them to take your side, rather than
winning a fight.
Real property tax management is about helping the local tax assessors get the information and
data they need to ensure you’re not paying more than your fair share of taxes.
Remember, the law is always on your side. When the data is on your side as well, it’s hard to lose
a property tax appeal.
Real Property Tax Advisors (RPTA) is committed to improving your bottom
line by managing the risk of property taxes. For more than 40 years, RPTA has
dedicated itself to achieving an unparalleled success in managing complex
property tax portfolios. To date, we’ve saved our clients hundreds of millions of
dollars in commercial real estate and personal property taxes across a variety of
industries, including commercial, industrial and manufacturing. RPTA represents
clients in all 50 states and manages over 80 million square feet. RPTA is
headquartered in Atlanta with offices in St. Louis and Chicago.