Cook County Assessor Raises Valuations of Commercial, Industrial and Multi-Family Properties Substantially More Than Residential Properties
2022 marks the triennial assessment year for all of the north and northwestern townships of Cook County. Through the first nine reassessment townships, Assessor Fritz Kaegi continues to increase assessments for commercial, industrial and multi-family residential properties at much higher rates than residential property owners. This trend began during Assessor Kaegi’s first reassessment in 2019 and continues through 2022.
According to a Crain’s Chicago Business, in an article entitled, “Kaegi Targets Commercial Property Again (September 19, 2022)”, it was reported that the total assessed value of all non-residential properties increased 43.41% for commercial, industrial and multi-tenant properties, while homeowners only experienced a 32.4% assessment increase. This assessment increase for non-residential assessment increases was lower in 2022 than it was during Kaegi’s first three triennial re-assessment years (2019-2021) in which increases in assessments amounted to 77% for non-residential properties.
These substantial assessment increases means that a larger portion of the tax burden will be placed onto landlords of commercial/industrial/multi-family properties and away from homeowners. As a result of the Assessor’s actions, real estate investors and developers are hesitant to invest in Cook County because of this uncertainty in the commercial real estate market’s exposure to soaring real estate tax obligations as compared to years preceding Fritz Kaegi’s arrival on the scene as Cook County’s Assessor.
Apartment building developer, Tony Rossi, President of Itasca-based M&R Development stated that “I’d rather step over into DuPage County. The market is just as good, and there’s more predictability on real estate taxes.” (p. 37). Also, S&P CoreLogic’s Case-Schiller home price index for the Chicago area has increased 28% since the beginning of 2020. However, Assessor Kaegi’s office reduced all residential properties in April, 2020 by 8%-12% because of what he anticipated would be depressions of home values due to the Covid-19 pandemic. In fact, quite the opposite occurred in many Cook County townships as the residential market appreciated in 2020 and 2021; in part due to low interest rates, and secondarily because apartment renters and owners of smaller homes were seeking additional space for workers who, because of the pandemic, needed a dedicated home-office and outdoor space for their children who stayed home for “Zoom” school.
In addition, due to the substantial increases in assessments for many property owners, the higher assessments meant that many property owners felt compelled to file assessment appeals with both the Assessor’s Office and the Cook County Board of Review (the first and second levels of three potential venues to hear property tax appeals in Illinois). Historically, that process would begin and end between February and September. However, in 2021, the Assessor’s appeal process did not begin until April and did not finish until December, delaying the Board of Review’s work by more than 4 months. Thus, the second installment 2021 tax bills will be delayed until sometime in December, 2022, or more than 4 months late from their typical issuance in July for August 1st payment.
