Lock Down. Travel Fear. Stadiums No Fans.
No Events or Conventions?
How is it that hotel property owners are still
paying the same amount in taxes?
Revenue Dropped 65%!
Why are hotels still paying high Property Taxes?
- Most 2020 assessed value was based on 01/01/2020, prior to COVID, using 2019 revenue
- 2021 government operates at huge deficit is trying to make it up from property taxes
- Tax assessors are clueless on how to value hotels operating at little to no profit
- Tax consultants are equally clueless when traditional income capitalization method does not work
Here’s what Tax Assessors may do to keep tax value high!
Convert income model to use a 5-year average revenue so 2020’s big drop weighs only 20%.
Disclosure states assessors may rely on Market Approach by choosing high sales to justify higher values.
Convert to Cost Approach which will likely keep the same value or possibly even raise the value.
The Ultimate Challenge
How to Achieve the Lowest Tax this Year!
- After suffering a devastating year, 2021 is the year ALL hotels must file Appeal.
- 2021 – Best chance to reduce property tax to the lowest level in years.
- Locking in the low taxable value for multiple years in some states.
- Since there is no uniformity when traditional method does not work, engage a tax consultant who specializes in hotels can make a huge difference.
- Do not miss the window of opportunity. Save far more tax by switching to an expert.
The O’Connor Difference
Pay Nothing unless Tax Reduced
Nation’s leading property tax consulting firm since 1974: 700+ employees
Represents thousands of hotels in 45 states with exceptional results
Aggressively pursue multiple rounds of appeals, including judicial appeals
Proprietary method to calculate non-taxable intangible value of hotel’s flag
Tracks recent hotel sales – able to select low sales to counter assessor’s values
Massive data resources to generate Uniform & Equal analysis on comparables
Apply a sophisticated Discounted Cash flow method based on projected future income
Pursue Disaster / Calamity reappraisal in applicable states (March 2021 deadline)
No Upfront Fees! You keep at least 2/3 of Tax savings. We cover legal & all expenses
Frequently Asked Questions
COVID-19 Impact on 2021 Hotel Property Taxes
Q: Hotels revenue dropped 69% in 2020, how come my 2020 property taxes did not go down?
Q: In that case, if 2020 revenue dropped 69% and Net Operating Income (NOI) dropped 90%, will 2021 property taxes also be dropped by 69% to 90%?
Q: In that case, what can we expect 2021 tax assessment value be?
Q: So, how will tax consultants do to help reduce hotels’ 2021 property taxes?
Q: What can O’Connor do differently?
This is the Year ALL hotel owners must file an appeal after encountering such a devastating year. In years past when hotel revenues went up, the assessed values went up accordingly. Now when revenue dropped significantly, tax assessors are trying to find ways to minimize your tax reduction. It will take a highly experienced tax consultant like O’Connor & Associates to help you maximize tax saving in 2021.