News & Press

City Landlords’ Biggest Property Tax Hurdle Still to Come

August 6, 2020

Still, landlords have been putting aside money for taxes for months and collecting enough rents over the course of the pandemic to foot their July 1 property tax bill, said Robert Gilman, head of accounting firm Anchin, Block & Anchin’s real estate practice.

For the next bill, due Jan. 1, there is much less cushion, he said.

“We aren’t close to getting things back to normal,” said Gilman, who represents some of the city’s largest landlords and real estate groups. “It’s only going to get worse before it gets better.”

For office landlords who have been collecting steady rents from their tenants, problems will begin once people start giving up space in the next few months, he suggested.

Commercial properties reported a nearly 8% delinquency rate this fiscal year, a 32% jump from last year, according to an analysis of city data. Gilman expects that number to rise by next year as more businesses, such as retailers and restaurants, close. 

“September rent is when we’ll see how bad it will be if there is no new stimulus package in next 30 days,” Gilman said. 

While overall city property tax collection was 6% higher this fiscal year than last, there’s still room for further delinquency through the end of the year, city landlord groups say.

“Positive overall collection data does not mean that some property owners and segments of the real estate market are not facing substantial revenue challenges,” Champeny said.

Government has to offer some relief, experts say.

“You have to give the landlords something,” Gilman said.

“The city got away with it for July, but it won’t get away with it for January,” Gilman said. 

Read the original article on Crain’s New York Business