►
From YouTube: Board of Equalization Meeting | August 29, 2023
Description
No description was provided for this meeting.
If this is YOUR meeting, an easy way to fix this is to add a description to your video, wherever mtngs.io found it (probably YouTube).
A
Today
is
Tuesday
August,
29th
2023.
This
is
the
Arlington
County
Board
of
Equalization
hearings.
We
have
six
cases
on
the
agenda.
The
first
two
cases,
RPC
140411,
187
and
RPC
50520
3A-
have
asked
to
be
withdrawn.
I
assume
Mr
chus,
there's
no
objection
from
the
county.
B
C
A
Okay,
with
that
said,
I'll
move
to
accept
the
withdrawal
on
the
first
one
ending
in
187
do
I
have
a
second
Mr.
Matkin
is,
second
all
in
favor.
I
opposed.
Okay,
it's
unanimous
and
the
second
one
ending
in
203a
I'll
move
to
accept
that
withdrawal
do
I
have
a
second.
B
A
Okay,
Mr
Lawson
is
a
second
all
in
favor,
I
opposed
okay.
That
is
also
unanimous.
Thank
you,
Mr
chus.
Thank
you.
Next
up,
we
need
we've
got
Rob
and
then
do
we
have
Mr
Harmon
on.
B
D
I'm
here
I
just
I
had
you
on
I
was
muted.
You
were
muted.
A
D
A
C
Yes,
thank
you,
so
this
is
1221
Gable's
Point
Apartments
I'm,
going
to
share
my
screen
here.
So
Madame
chairwoman,
members
of
the
board,
members
of
the
government
good
morning
to
start
I
assume
everyone
has
the
a
test
page
that
shows
through
column
G.
The
initial
submitt
only
showed
half
the
page,
so
I
want
to
make
sure
everyone
can
see
the
full
submitt.
The
issue
on
appeal
is
the
market
cap
rate
applied
now
I
want
to
start.
C
Last
week
there
was
some
discussion
about
the
effect
of
rising
rents
in
future
years
and
how
that
impacts.
Value
of
properties.
I
want
to
address
that,
while
this
is
more
reflective
of
a
discounted
cash
flow
analysis
which
we
are
not
allowed
to
use
in
Virginia
assessments,
we
have
provided
on
this
particular
case
an
example
of
rental
rate
growth.
Here
we
grew
the
2022
rental
income
by
7.8%,
which,
as
you
can
see
on
the
Dr
test
column,
the
Dr
was
quick
to
adopt
that
assumption.
C
Using
this
large
increase
in
rent,
we
see
that
the
final
value
is
still
$2.6
million
below
the
initial
assessment.
If
we
apply
a
cap
rate,
that's
reflective
of
the
market
as
it
stood
on
January
1st
2023.
The
dr's
cap
rate
is
the
lowest
cap
rate
used
in
any
of
the
past
15
years
and
is
simply
not
reflective
of
the
market.
C
C
Let's
look
at
a
sampling
of
shorter
term
bonds
that
the
government
claims
as
more
appropriate
as
indicative
of
interest
rates
and
see
how
those
have
changed
in
2022,
every
one
of
the
treasury
bills,
with
a
52-
we
or
shorter
maturity
increased
by
400
basis
points
are
greater
over
the
course
of
2022,
so
the
Dr
States,
the
236
basis,
point
increase
on
the
10year
T
bill
is
not
appropriate
that
we
should
be
looking
at
shorter
maturity
bills.
These
shorter
maturity
bills
show
support
an
even
greater
increase
in
the
cap
rate.
C
Here
you
can
see
every
short-term
Bond
increase
by
about
4%
or
more
over
the
course
of
2022.
The
Dr
cap
rate
CH
cap
rates
did
not
change
picked
up.
Zero
of
this
increase
now
2022
was
unique
in
that
the
Federal
Reserve
raised
interest
rates
seven
times
and
by
425
basis
points.
This
is
more
than
three
times
the
average
movement
in
interest
rates
over
the
past
15
years.
2022
is
different
from
other
years
because
of
this
the
last
time
interest
rates
increased
anywhere
nearly
as
rapidly
as
last
year.
C
The
DEA
increased
base
apartment
cap
rates
by
125
basis
points
we're
only
imputing
an
increase
of
75
basis
points.
Now
we
can
also
look
at
the
interest
rate
on
other
financial
investments
outside
of
government
bonds
to
see
what
happened
in
2022,
the
Sofer
increased
by
425
basis
points,
tripleb,
Us
corporate
bonds,
often
appr
proxy
of
cap
rates,
increased
310
basis
points,
30-year
fixed
rate
mortgages,
increased
331
basis
points
most,
if
not
all
interest
bearing
financial
investments
increased
in
2020
two.
C
Now
these
interest
rates
increased
steadily
throughout
the
year
from
when
the
FED
began
raising
rates
in
March.
This
was
not
a
one-day
phenomenon;
rather
it
was
spread
across
10
of
the
12
months
of
the
year,
with
more
known
to
be
coming
in
2023.
This
does
impact
the
market.
This
was
known
as
of
the
date
of
value.
It
was
known
as
of
midye
2022,
so
interest
rates
do
affect
cap
rates
and
interest
rates
did
rise
across
the
board
throughout
2022
and
even
with
an
ambitious
projection
of
rent
growth
of
nearly
8%.
C
If
we
apply
the
appropriate
cap
rate,
we
get
a
lower
value
than
the
assessment.
The
taxpayer
again,
we've
imputed
75
basis
points
as
an
appropriate
increase
to
the
cap
rating.
Now,
I'd
like
to
direct
your
attention
to
page
six
of
the
board
submission
here,
you
see.
The
second
set
of
dat
data
shows
sales
data
through
December
31st
of
20123.
What
you
will
not
see
on
this
list
that
the
Dr
has
provided
of
20
23
sales
is
the
Avalon
on
Columbia
Pike,
which
sold
on
July
24th
of
2023,
this
property
sold
for
$15
million.
C
The
2023
assessment
for
this
property
is
right
at
$118
million
for
an
assessment
to
sale
ratio
of
112%.
This
property
was
built
in
2009,
just
like
the
subject
property
and
was
95%
occupied
at
the
time
of
sale.
Just
as
the
Dr
mentions,
this
property
was
on
June
27th
of
2023.
We
can
back
into
a
sale
cap
rate
from
this
sale
count.
We
can
use
the
2023
assessment,
of18
million
and
back
into
the
noi,
the
Dr
applied
to
this
property.
C
By
applying
the
guideline
cap
rates
to
each
parcel,
then
we
back
out
the
retail
portion
of
the
property
to
get
to
the
multif
family
noi,
applying
this
noi
to
the
sale
price
we
get
to
a
cap
rate
of
6.66%
the
assessment
for
the
multif
family
portion
of
the
Jasper.
This
comp
sale
is
5.5%
a
difference
of
116
basis
points.
So
we
know
the
assessment
missed
the
cap
rate
on
the
sale
count
by
116
basis
points.
Clearly,
the
guideline
cap
rates
do
not
reflect
market
cap
rates.
C
As
of
the
data
for
the
subject
property,
we
have
only
imputed
a
75
basis.
Point
increase
I
also
spoke
with
a
multi
family
owner
in
the
county
last
week,
who
is
reviewing
purchase
opportunities
in
the
county.
He
told
me
that
the
cap
rate
needs
to
be
a
6.3
to
6.85%
for
them
to
be
interested
in
a
property
due
to
the
cost
of
capital.
C
He
said
these
rates
are
for
Value
ad
opportunities,
meaning
the
cap
rates
would
be
higher
for
newer,
stabilized
properties
again
here,
the
Dr
is
only
at
a
5.5%
cap
rate,
fully
135
basis
points
below
the
upper
end
of
this
Market
participants
analysis.
Now
we
can
also
look
what
about
the
cost
of
capital.
We
can
analyze
the
effect
of
the
increases
in
the
cost
of
capital
by
looking
at
only
a
200
basis,
point
increase
in
loan
costs.
We
know
the
Sofer
increased
by
425
basis
points.
Let's
just
assume
a
conservative
estimate
of
only
200
basis
points.
C
You
can
see
here
that,
as
of
January
1
2022,
an
estimate
of
the
cost
of
capital
of
3.52%
with
a
70%
loan
to
value
results
in
a
weighted
average
cost
of
capital
of
2.46%
one
year
later,
January
1
2023,
knowing
the
cost
of
capital
increase
by
at
least
200
basis
points,
and
that
Banks
now
require
a
greater
share
of
equity.
You
can
see
the
cost
of
capital
increased
by
at
least
106
basis
points
year
over
year
to
wrap
up
I
want
to
address.
The
second
comment
on
the
Dr
test.
C
Page
I
was
surprised
when
I
saw
this
comment,
you
can
see
on
the
screen
the
email
request
the
Dr
sent
for
this
property's
rent
roll.
You
can
see
here
this
Shuttlesworth
States,
the
rent,
Matrix
information,
that
the
Dr
request
on
their
INE
forms
is
not
sufficient
for
assessment
purposes.
According
to
miss
shellsworth
I
want
to
point
out
that
the
owner
of
this
property
did
provide
what
was
requested
on
the
in
and
provided
it
for
each
of
the
past
three
years.
C
All
the
INE
request
is
a
rink
Matrix,
as
you
can
see
on
page
88
of
the
board
pack.
This
information
is
provided
on
page
92
of
the
board
pack
for
2022,
page
103
for
2021
and
Page
111
for
2020.
Providing
this
information
to
the
Dr
was
a
courtesy
of
the
owner
to
the
government,
as
this
information
is
not
required
to
be
provided
by
law.
I
communicated
this
to
miss
Shuttlesworth
in
response
to
her
request.
I
also
told
her
that
owners
are
typically
hesitant
to
share
this
information
due
to
privacy
and
confidentiality
concerns.
C
We
have
seen
multiple
instances
this
year,
where
the
government
has
shared
confidential
information
publicly
and
with
non
ERS.
This
was
all
communicated
to
miss
Shuttlesworth,
who
chose
not
to
reply.
None
of
this
was
brought
up
in
the
Dr
hearing.
We
had
for
this
property
either
the
owner
provided
three
years
worth
of
rent
matrices,
as
requested
by
the
Dr.
This
is
above
and
beyond
what
is
required
by
Statute
Additionally.
The
proforma
even
grows
the
rental
income
by
nearly
8%
over
what
the
property
reported
in
2022.
C
A
You,
okay,
thank
you,
Miss
Shuttlesworth,
for
the
county.
Please.
E
Yes,
good
morning,
everyone
so
the
subject:
property
is
a
mise
multif
family
building
with
132
units,
and
it
was
built
in
2009.
The
amenities
include
Fitness
Center
business
center
community
Lounge,
cyber
loue
and
package
notification.
An
interior
and
exterior
inspection
was
conducted
on
June
27th
this
year
and
informal
hearing
was
held
on
June
23rd
also
this
year.
The
issue
is
that
the
appellant
is
contesting
the
cap
rate
we
have
performed.
The
analysis
of
the
in
survey
is
provided
to
us
from
2019
through
2022,
and
we
have
concluded
the
2020
and
2020
IE.
E
Surveys
show
decline
in
rental
parking
and
other
income.
The
noi
reported
for
2021
showed
the
26%
decline
as
compared
to
the
2020
noi.
Things
started
to
look
little
bit
better
for
the
subject
in
2022.
As
the
rental
income
experienced
an
8
and
a
half%
growth
and
the
vacancy
and
Concession
declined
from
6.45%
to
5.66%.
E
We
have
not
received
the
actual
2022
rent
roll,
so
we
could
not
determine
the
physical
vacancy
as
of
January
1
2023
again,
the
the
appellant
representative
stopped
providing
these
just
recently
to
our
department
due
to
privacy
and
confidentiality
concerns
they
did
provide.
The
summary
rent
roll
with
their
own
average
monthly
rent
calculations,
which
you
can
see
I,
believe
it
is
on
page
12
in
the
Boe
packet.
E
When
you
compare
the
average
monthly
rents
provided
by
the
appellant
to
the
rents
we
used
in
our
mix
in
our
worksheet,
which
you
can
also
see
on
your
page
four,
you
will
see
the
numbers
are
almost
identical.
The
2022
INE
had
to
be
reconstructed,
to
exclude
$259,700
of
capital
expenses,
which
was
for
the
roof
replacement.
Our
projected
rental
income
and
GPI
very
closely
mimic
the
figures
projected
by
the
appellant
and
we
also
applied
Opex
at
you-
can
see.
E
I
cannot
say
it
loud,
but
you
can
see
the
Opex
per
unit
we
have
applied
in
our
test.
Column
f
is
actually
higher
than
the
OPC
per
unit
appellant
used
in
his
perform
and
with
such
conservative
approach,
the
fir
market
value
estimates
stated
in
our
test.
Column
f
is
still
above
the
subject.
2023
assessment.
That's
all
thank.
A
You,
okay.
Thank
you,
questions
from
any
board.
F
Matkin,
thank
you
since,
since
this
really
is,
as
excuse
me,
Dr
has
pointed
out
really
only
a
cap
rate
issue,
because
numbers
income
expenses
are
all
very,
very,
very
close.
I
think
it's
while
for
the
Department
to
again
review
why,
in
the
face
of
the
appellant
expansive
exhibition
of
increasing
interest
rates
and
the
proposed
effect
on
on
capitalization
rates
and
therefore
sales
prices,
why
the
department
didn't
change
capitalization
rates
from
last
year
to.
E
This
sure
so,
as
I
mentioned
I
believe
last
week,
the
tenure
and
by
the
way,
I
just
wanted
to
make
a
clarification.
We
never
implied
that
we
should
use
52
week
T
bill
as
a
measure.
That
was
that
was
not
correct
statement
comments.
Yes,
I'm
glad
everybody
can
see
the
comments.
Thank
you.
So
the
the
10year
treasury
note
is
a
benchmark
for
the
investors.
Investor
use
it
to
decide
whether
or
not
it's
worth
for
them
to
take
risky
investment,
more
risky
investment.
We
are
assessors,
we
use
different
metrics.
E
We
we'
never
used
10e
treasury
note
as
a
metric.
We
analyze
Ines
provided
to
us
hundreds
of
Ines
and
we
follow
the
trends,
and
if
we
see
that
there
is
a
trend
in
noi
surveys
that
would
dictate
the
changes
need
to
be
made.
We
make
those
changes
they're
not
always
made
to
the
cap
rate.
We
might
address
the
issues
by
adjusting
rental
market
rates.
We
can
address
it
by
adjusting
the
vacancies
we
can
adjust
it
by
modifying
the
Opex
ratios
that
we
apply.
We
don't
use
10e
treasury
note
as
a
measure.
E
No
other
surrounding
County
does
that
and
what
I
meant
is
the
fif
there's
no
such
thing
as
10year
T
Bill.
What
I
meant
is
that
t
bills
are
52
week.
Investment
vehicles,
they're
just
short
maturity,
I,
never
mentioned
I,
never
stated
that
it
should
be
used
as
a
measure
okay.
So
this
is
my
respond
to
the
cap
and
again,
the
I
think
Mr
Harmon
mentioned
Avalon
property,
the
sale
that
occurred
in
July.
E
We
actually
had
a
hearing
for
that
property
last
week
that
sale
Accord
in
2023
and
it
it
will
be
used
in
2024
analysis.
Thank
you.
G
And
can
I
just
note
that
there
were
13
sales
that
were
for
2022
that
were
included
in
our
cap
rate
analysis,
in
addition
to
using
the
those
13
sales
that
were
that
are
in
part
of
the
2023
guidelines.
We
also
look
reviewed
all
of
the
income
expensive
questionnaires
that
were
submitted
by
the
department,
so
there
is
a
thorough
analysis
that
that
is
that
is
completed
every
year
to
determine
that
Year's
cap
rates.
Right
now
we
appreciate
the
information
for
this
year's
sales,
which
will
be
used
for
next
year.
Thank
you.
C
B
C
Projects
existing
projects
that
he
was
going
to
go
in
and
and
invest
some
capex
and
then
try
to
bring
up
rents
via
that
method,
and
that's
why
he
was
able
to
to
project
a
cap
rate.
Purchase
cap
rate
below
the
cost
of
capital
was
because
of
those
assumptions
of
investing
and
bringing
noi
up.
E
C
Yes,
thank
you
so
Apartments
investing
at
at
at
the
heart
of
it.
It's
a
financial
investment
you're
buying
an
income
stream.
So
with
that
you
have
to
take
into
account
the
cost
of
capital
and
looking
at
and
interest
rates
play
into
that.
Looking
at
every
measure
of
interest
rates,
we
chose
the
10year
T
bill.
As
a
conservative
estimate.
It
changed
the
least
of
most
interest
rates.
I
showed
that
shorter
term
maturities
changed
over
4%,
the
Sofer
changed
over
4%.
The
cap
rate
changed
0%
the
last
time.
This
happened
in
200920.
C
B
Yeah,
why
don't
I
go
ahead
and
start
and
share
a
few
thoughts,
I
think
in
the
office
Market,
it's
been
clearly
demonstrated.
There
has
been
a
revolution
in
the
way
things
are
happening
and
cap
rate
adjustments
are
appropriate
on
the
residential.
It's
not
as
clear
to
me
and
you
have
a
couple
things
going
on
in
the
industry,
and
one
of
them
is
that
people
like,
oh
I,
don't
know
John
shushan.
B
You
know
he
has
apartment
buildings
and
he
has
existing
loans
and
eventually
those
loans
come
due
and
when,
when
they
come
due,
then
the
interest
rates
got
to
go
up,
and
so
the
Project's
going
to
have
to
carry
that
that
increased
interest
rate
there's
been
some
articles
written
about
it
that
that
this
used
to
be
quote
the
Safe
Harbor
for
investing
in
real
estate.
B
Maybe
it
isn't
anymore,
I
think
the
industry
is
still
shaking
out
on
on
how
how
projects
like
this
are
going
to
continue
to
be
held
in
in
financed.
I
did
a
little
bit
of
of
of
calculation
and
assuming
that
there's
no
loan
on
the
property
you're
still
looking
at
a
return
on
value
of
between
5.8
to
six
to
6.4%,
depending
upon
where
the
actual
value
is
when
you,
when
you
look
at
the
cap
rates,
and
so
I
I
I,
think
that
this
probably
will
have
an
impact.
B
What
I'm
seeing
right
now
is
that
the
buyers
that
are
out
there
are
picking
they're
picking
properties
that
they
can
acquire
at
under
what
they
think
their
true
value
is
they're,
looking
at
distressed
properties,
things
of
that
nature,
and
so
we
do
have
comps
out.
We
have
comps
this
year
out
there
how
much,
how
much
there're
a
cherry
pick
by
a
all
cash
buyer
or
somebody
who
has
plenty
of
financing
ability,
I,
don't
know!
Yet
that's
something
that
we're
going
to
have
to
see
how
it
plays
out
in
in
the
future.
B
I
myself
speaking
just
for
myself
and
I'm
very
curious.
What
others
are
going
to
say.
I
myself
am
not
yet
convinced
that
it's
time
to
adjust
cap
rates
for
residential
and
I
say
that,
because
you
you
have
increasing
rents,
you
have
values
in
Arlington
that
typically
hold
you
know.
I
I,
remember
developers
used
to
say
if
you're
going
to
make
a
mistake,
make
it
inside
the
Beltway
and
you
are
going
to
have
future
appreciation
and
so
I
I,
don't
think
you
can
can
say.
B
F
H
I
A
Okay,
so
that
is
four
to
zero
and
the
County's
confirmed
at
40,
73500.
Thank
you
we'll
go
ahead
and
keep
with
Miss
Shuttlesworth
since
we
started
early.
So
let's
move
to
the
fifth
item
on
the
agenda,
which
is
RPC
16021
02a
at
101,
Wilson
Boulevard,
Mr
Harmon.
You
can
start
with
your
eight
minutes
on
that.
A
C
Yes,
thank
you.
So
this
is
the
London
and
norid
House
Apartments
in
Rosland.
The
two
buildings
have
a
combined
196
units
and
were
built
in
1965.
The
buildings
feature
original
floors
and
original
Windows
Additionally
the
roof
dates
to
1995
and
will
need
to
be
replaced
in
the
near
future.
To
account
for
this,
the
Dr
did
increase
the
effective
age
of
the
building,
which
we
appreciate.
The
Dr
recommended
value
is
a
$5
million
increase
over
the
2022
assessment.
C
The
issue
on
issues
on
appeal
are
the
vacancy
and
collection
rate
and
the
cap
rate,
starting
with
the
test
page.
The
Dr
did
not
provide
a
complete
page
and
until
this
morning,
so
we
only
have
columns
a
through
D,
but
I
can
tell
you
from
those
columns
columns
a
through
C
show
purport
to
show
the
operating
history
of
the
property,
but
it's
not
accurate.
It
appears
the
columns
were
all
shifted.
C
The
2021
noi
should
be
as
reported
on
the
INE
$3,498
th000,
not
4,531,
th000
2021
noi
should
be
2,916,
546,
not
3,498,
th000
and
while
I
cannot
see
what
they've
entered
for
the
2022
column,
the
noi
reported
on
the
IE
was
3,536
388.
So
knowing
this
the
prior
three
years,
average
noi
was
$3,317
th000.
The
assessed
in
oi
is
$3,669
th000.
This
discrepancy
is
due
to
the
assessment
not
considering
the
actual
income
loss
due
to
vacancy
and
collection
loss,
rent
loss
and
concessions.
C
This
property
has
operated
well
above
6%
vacan
vacancy
and
collection
loss
imputed
by
the
assessment
for
each
of
the
past
three
years.
Here
again,
the
columns
on
the
page
we
were
provided
are
incorrect.
As
to
vacancy
and
collection
loss
for
2020
vacancy
and
collection
loss
was
99.2%
for
2021.
It
was
16%.
Last
year
2022
it
was
8.3%.
This
is
a
three-year
average
of
over
11%
vacancy
in
collection
loss.
Clearly,
the
6%
imputed
by
the
assessment
is
not
capturing.
The
actual
state
of
this
property,
a
higher
vacancy
and
collection
loss
rate
for
this
property
makes
sense.
C
This
property,
as
I
stated
at
the
beginning,
was
built
in
1965
and
still
has
the
original
floors
and
windows.
The
amenities
are
below
what
typical
tenants
expect
the
pool
is
Walled
off
and
lacks
sunlight.
The
gym
is
on
the
roof
of
the
building.
You
have
to
take
an
elevator
to
the
top
floor,
then
go
up
a
stairwell
to
get
to
the
the
small
gym
on
the
roof.
C
Finally,
these
properties
are
located
at
the
edge
of
rosin,
where
there
are
large
vacancies
in
the
neighboring
buildings,
and
it's
really
a
a
lackluster
vibe
in
this.
In
this
area.
You
can
see
in
the
assessor
comments
that
the
vacancy
rate,
on
one
day
in
June
when
we
visited
the
property,
was
used
to
justify
the
6%
vacancy
and
collection
loss
rate.
This
misses
the
impact
of
the
loss
of
this
property
for
several
reasons.
First,
this
States
one
day
out
of
365.
C
This
gives
us
a
view
of
the
property
on
only
that
day
and
does
not
take
into
account
the
rest
of
the
year.
It
doesn't
take
into
account
the
day
before
the
visit
or
the
day
after
or
any
of
the
other
days
of
the
year.
By
doing
this,
the
assessor
ignores
the
full
year
vacancy
data
that
they
were
given
given
on
the
INE
on
the
2022
INE,
the
it
asks
what
was
the
average
vacancy
over
2022?
C
You
can
see
on
page
75
of
the
board
pack
that
the
property
reported
an
average
of
just
vacancy
loss
of
6%.
This
doesn't
include
rent
loss
collection,
loss
concessions.
The
average
vacancy
for
2021
was
nearly
12%,
as
shown
on
page
80
of
the
board
PC.
Yet
the
assessor
again
relies
on
the
vacancy
on
one
day
in
June
of
2023
to
support
the
vacancy
and
collection
loss
rate,
relying
on
on
the
vacancy
rate
on
one
day
in
June,
also
ignores
again
the
rent
loss
and
concessions
that
this
property
has
reported.
C
Historically,
we
request
the
actual
2022
vacancy
and
collection
rate
of
8.3%,
which
is
the
lowest
of
any
of
the
past
three
years
reported
to
be
applied
to
the
assessment.
Next
to
the
cap
rate,
the
cap
rate
was
adjusted
based
on
effective
age,
but
remains
unchanged
due
to
any
of
the
financial
turmoil
experienced
in
the
market
over
the
course
of
20122.
The
tax
loaded
cap
rate
is
only
5.55%.
The
previous
property
we
heard
was
assessed
at
a
cap
rate
of
5.5%.
That
building
was
built
in
2009.
C
This
one
dates
to
196
5
that
building
had
a
stabilized
vacancy
and
colle
collection
rate
near
the
Dr
imputed
rate.
This
property
has
averaged
11%,
plus
vacancy
and
collection
loss
over
the
past
three
years.
This
property
would
fit
the
bill
of
more
of
a
value
ad
type
project
that
fits
what
I
was
speaking
to
that
local
investor
I
I
mentioned
in
the
last
case,
would
look
at
that
investor
again
mentioned.
They
need
a
cap
rate
of
6.3
to
6.
85%
to
be
interested
in
a
purchase
again.
C
The
cap
rate
on
this
property
is
only
at
5.55%
now
as
to
the
question
of
cash
buyers
versus
typ
buyers,
taking
out
a
loan.
A
couple
of
points.
First
I'd
ask:
how
has
the
Dr
adjusted
sale
cap
rates
for
cash
buyers
in
their
model?
They
mentioned
that
they
have
2022
sales
from
the
beginning
of
the
Year.
How
have
they
adjusted
those
for
cash
buyers
versus
buyers
who
took
out
a
loan?
C
Second,
if
you
are
a
cash
buyer
you're
increasing
your
risk,
you're
increasing
the
amount
of
money
that
you
have
at
risk
with
the
property.
Necessarily,
you
also
increase
your
required
return
in
conclusion,
considering
the
cost
of
capital
alone
that
took
place
over
the
course
of
2022,
that
shows
an
increase
of
106
basis
points,
assuming
that
that's
conservatively,
assuming
an
increase
of
only
200
basis
points
in
the
cost
of
capital
and
and
not
the
425
basis,
points
that
the
Sofer
actually
did
increase.
C
E
Yes,
so
the
the
subject,
property
is
located.
Three
blocks
east
of
Ros
Metro,
stop.
It
is
a
high
high-rise
style
built
in
1965
building
and
it's
located
on
two
separate
Parcels,
two
separate
building
Normandy
house
and
London
house,
and
the
combined
property
amenities
include
pool
gym
a
rooftop
Terrace
for
grilling
and
Gathering
and
garage
parking
spaces.
The
property
is
also
part
of
the
development
development
plan
that
was
already
approved
by
the
board.
E
E
So
when
you
look
at
our
test
column
f,
you
can
see
we
were
very
conservative.
We
actually
mimicked
the
potential
income
from
apartment
we
actually
make
whatever
the
the
appellant
had
on
his
performer.
We
also
have
mimicked
closely
the
other
strings
of
income,
which
is
parking
and
other
income,
and
our
projected
GPI
is
just
slightly
slightly
above
the
projected
GPI
they
have
in
the
column
G.
E
Now,
based
on
the
visual
inspections,
we
did
adjust
the
effective
age
which
resulted
in
the
capup
rate
change
cap
rate
change
from
5.45
to.
E
Now
we
were
not
able
to
verify
the
actual
the
the
the
actual
physical
vacancy
as
of
January
1,
because
again
we
were
not
provided
the
actual
rent
rols
for
the
prior
year
and
the
based
on
the
conversation
with
the
the
on-site
property
manager
we
I
had
during
the
inspection.
I
was
only
able
to
verify
that
the
occupancy
level
as
of
June
une
2023
was
98%.
The
noi
reported
very
modest
increase.
The
2022
I
reported
very
modest
increase,
as
you
can
see,
and
based
on
yeah.
E
I
already
said
that
so
our
proposed
noi
in
column,
F
shows
only
3.75
increase
and
it
factors
The
increased
occup,
PCY
level
to
98%
and
based
on
the
summary
rental
provided
by
the
and
again,
we
could
not
actually
establish
the
physical
vacancy
as
of
January
1.
Thank
you.
A
Okay,
thank
you.
Questions
from
board
members
I'll
just
ask
Miss
Shuttlesworth.
Can
you
just
address
the
point
that
the
appellant
brought
up
about
that
the
noi
on
thei
prior
years
is
incorrect.
E
E
Month,
67,
yes,
it
yes,
Mr
Harmon
was
correct,
they
were
shifted,
The
Columns
were
shifted
so.
E
No
not
really
and
again
I
just
wanted
to
add
that
we
did
perform
the
inspection
on
site.
We
did
address
the
effective
AG.
The
property
is
dated,
it
has
old
roof
that
will
need
replacement
soon,
original
windows
original
floors,
only
few
kitchens
have
updated
cabinets
and
the
units
are
updated
on
as
needed
basis.
We
addressed
that
and
we
asked
the
board
to
confirm
our
revised
assessment
of
66,1
18,600.
Thank.
C
Yes,
thank
you.
So
page
75
of
the
board
pack
provides
the
2022
in
there.
You
can
see
they
have
a
line
that
ask
what
was
physical
vacancy
on
January
1
2023,
the
the
owner
reported
88.1%.
The
Dr
EA
has
that
information.
Next,
this
property
is
riskier
than
other
properties.
You
can
see
the
fluctuations
in
noi,
that's
because
of
the
age
of
this
property.
It's
because
of
the
location.
It's
not
well
situated
it's
an
old
property,
so
it
is
riskier
than
other
properties.
C
A
Members
I
mean
I
I'll,
I'll
start
on
this
I
mean
initially
when
I
looked
at
this
I
I
thought:
okay,
43,
45,
34
35,
we're
kind
of
in
the
ballpark.
It's
trying
to
come
back
but
I
think
the
fact
that
we've
got
the
incorrect
information
there
and
the
43
drops
off
and
we
go
to
2,
93445
and
31
I
think
there's
more
of
a
a
a
gap
and
a
spread
that
keeps
you
know
that
I'm
uncomfortable
with
so
what
I
did
was
just
took.
A
Colum
me
the
operating
numbers
coming
from
the
appellant,
which
you
know
and
to
quote
Miss
Shuttlesworth
they're
somewhat
mirrored
I
mean
it's
close,
but
it's
not
quite
there.
But
if
you
take
that
number
and
cap
it
out,
it
comes
out
to
64
297
950,
which
is
still
a
3.
.1
million
increase.
It's
you
know
over
5
5%
increase
from
last
year.
I
think
that's
more
realistic
than
where
it
is
right.
Now
it's
like
a
5.1%
increase
but
interested
in
what
other
folks
have
to
say.
Mr.
F
Matkin,
thank
you.
I
I
was
I
I
didn't
see.
This
is
a
dated
property.
It's
in
process
of
being
down
the
line
of
being
redeveloped.
Certainly
the
commercial
property
between
the
two
Residential
Properties
is
finally,
after
probably
12
years
of
discussion
about
to
be
redeveloped.
F
So
it's
upsetting
here
and
I,
it's
it's
stabilized,
it
seems,
but
8%
increase
to
me
is
more
than
stabilized,
so
what
I
did
was
even
simpler
but
came
up
with
close
to
the
same
conclusion:
I
just
took
the
test
column
F
but
applied
what
the
appal
says
was
the
true
nature
of
the
vacancy
and
concessions
8.3%
and
came
up
with
a
figure
of
63
mil
439,000
plus.
So
and
again,
it's
inductive
reasoning,
I
thought
an
8%
increase
just
seemed
unwarranted.
H
D
A
F
H
Folks,
Mr
yeah
I,
not
having
the
whole
all
the
columns
and
the
package
you
know,
I
was
trying
to
figure
out
exactly
what
was
submitted
and
looking
at
all
the
past
income
and
expenses.
Statements
from
the
appellant
I,
pretty
much
came
up
with
the
you
know
and
agree
with
Mr
Haron
that
U.
H
You
know
the
average
noi
was
about
3.3
for
all
these
past
years
and
what
I
did
is
I
I
went
further
than
I
would
normally
do,
but
I
took
the
original
assessment
and
I
took
the
EXP,
the
vacancy
at
8%
and
the
expenses
at
the
same
39.5.
So
my
final
value
is
much
lower
than
what
you
came
up
with
a
little
bit
above
from
last
year,
but
I
came
up
with
61
m714.
H
What
percentage
of
what
I'm
sorry
increase?
I
didn't
do
that
I
mean
last
year
it
was
very
little
I.
It's
very
small
600,000.
H
The
vacancy
and
concessions
at
8%-
that's
the
main
one.
The
the
expenses
were
the
same
39.5.
F
B
H
Check
my
ma
yeah
I
use
%
and
the
expenses
I
mean
the
vacancy
inations
amount
is
57.
H
B
Please
o
sorry
about
that.
I
didn't
realize,
I
turned
it
off,
I
may
be
in
the
minority
again.
I'm
good
with
the
county,
assessed
value
and
I.
Think
that
probably
the
owner
is
Treading
Water
until
circumstances
line
up
and
they
raise
this
and
rebu
so
I'm
I'm,
okay,
I'm
looks
like
I'll
get
out
voted.
F
Math
I
checked
mine
and
it
it's
at
88.3%
and
the
64
29
634
39
900
is
what
I
get
again
a
second
time
and
I'll
address
Barn's
comment:
I
I
agree
completely
they're
treading
water
and
they're
going
to
put
in
as
little
as
possible,
and
it's
to
me
another
reason
why
it
shouldn't
go
up
8%
assessment
from
last
year.
H
B
B
F
A
F
No
no
55
I
have
what
is
in
column
F,
which
M
Shuttlesworth,
you
know
noted,
was
an
increase
in
last
from
their
original
column,
D
assessment.
A
Ar
you
taking
column,
D,
correct
and
you're
changing
the
vacancy
to
8%.
A
A
A
H
248
59
I
come
up
with
5932
422.
H
B
F
H
A
555,
okay,
do
I
have
a
second
on
that
Mr
matkin;
okay,
all
in
favor
I
opposed
okay,
it's
unanimous.
It's
reduced
to
65,
mil
49700,
based
on
the
original
assessment,
increasing
the
vacancy
to
8%
and
changing
the
cap
rate
to
5.55%.
A
D
You
bet
thank
you.
This
property
was
built
in
1986,
we
did
request
a
department
hearing
and
that
request
was
refused
the
like
almost
every
case.
The
board
has
heard
the
county
has
increased,
has
used
information
through
July
of
2023
and
the
taxpayer
respectfully
requests
that
it
also
be
allowed
to
include
information
through
July,
20,
23,
interesting
facts.
The
income
has
declined
every
year
since
2019
or
a
total
of
46%
from
2019
to
2022.
The
assessment
is
down
only
11%.
During
that
same
time
period
the
property
was
50%
vacant
about
50%
vacant
on
year.
D
One,
and
perhaps
the
most
interesting
information
is
that
the
property
was
rendered
to
the
lender
of
Phineas
using
a
tender
option,
and
you
can
see
this
on
page
eight.
That
ainias
is
now
the
true
owner.
Previously
it
was
Meridian.
Also
on
page
eight,
you
can
see
that
the
loan
balance
was
about
$31
million,
so
the
assessment
is
significantly
greater
than
the
loan
balance.
The
owner
opted
to
give
this
property
back
and
using
a
tender
option.
It
did
so.
Issues
on
appeal
are
the
rent
on
occupied
space.
D
Taxpayer
uses
3939
rent
on
vacant
space
351
the
vacancy
rate,
30%
operating
expenses,
10.87%
cap
rate
increased
by
2%
and
Lease
up
two
years.
The
Department's
cap
rate
is
disassociated
with
Market
reality.
The
sales
demonstrate
fourth
quarter.
Sales
demonstrate
that
the
guidelines
are
wrong.
The
financial
markets
don't
support
the
guidelines.
The
county
ignored
interest
rates
when
determining
the
guidelines,
and
not
even
the
outdated
corack
report,
support
the
guidelines.
D
Fourth
quarter:
market
sales
contained
in
the
guidelines
indicate
that
at
1776
Wilson
that
property
was
originally
assessed
at
15%,
more
than
it
sold
for
you
would
need
to
increase
the
County's
cap
rate
by
100
basis.
Point
2445,
Army
Navy
sold
for
6
million
140%
is
the
assessment
sale
assessment
ratio.
You
would
need
to
increase
the
cap
rate.
The
Drea
cap
rate
by
294
basis,
points
that
are
100
basis,
point
increase
a
294
basis,
point
increase
or
an
average
of
197
basis,
points
that
you
would
need
to
increase
Drea's
cap
rate
or
1.97%.
D
Daa
has
historically
tracked
somewhat
the
10-year
t-
bill
over
the
last
15
years,
the
average
Delta
between
the
t-
bill
and
the
County's
lowest
cap
rate
3.45%
this
year.
It
was
only
1.51%,
you
would
need
to
increase
the
cap
rate
by
194
basis
points
to
come
into
to
get
to
the
average
over
the
last
15
years.
Corpex
a
study
done
completed,
August
2022
average
occupancy
95%
for
the
buildings
in
Arlington.
D
According
to
the
guidelines
on
page
27,
the
average
occupancy
rate
for
buildings
in
Arlington
was
77%,
so
a
full
18%
greater
the
average
weighted
average
lease
term
on
the
properties
in
Mr
Cora's
study
were
seven
years.
This
property
has
a
weighted
average
lease
term
of
only
2.1
years.
Mr
corpac,
States
cap
rates
bottomed
out
in
2019
and
have
increased
from
19
to
22.
Cap
rates
have
been
unchanged
in
the
county
in
from
2019
to
2022.
Mr
corpex
also
states
that
rollover
risk
and
high
vacancy
increases.
D
The
cap
rate
and
the
county
has
made
no
adjustment
to
any
of
its
properties
for
roll
over
risk
or
high
vacancy
on
page
60,
Mr
corpac,
States,
real
property
cap
rates,
pricing
and
values
are
driven
by
numerous
factors,
including
location,
occupancy,
tenant
credit,
space,
Market
characteristics,
competition,
transaction
volume,
financing,
investment
risk
and
expected
income.
So
here
you
have
a
property
with
2.1
years
left
of
weighted
average
lease
term.
You
have
financing
that
has
gone
up
dramatically.
You
have
transaction
volume
that
that
is
near
zero
and,
as
a
result,
the
cap
rate
should
be
increased.
D
We
have
S
for
going
up,
425
basis
points,
Triple,
B,
Us,
corporate
bonds,
310
that
tends
to
be
the
indic
that
mirrors
most
office
properties,
sixe
mortgage
rates
up
331,
a
10-year
T
Bill
up
236
Drea,
up
zero
impact
on
markets
and
of
financing.
So
on
1122
you
could
have
a
triple
B
Bond
at
2.6%,
using
70%
debt
equity
ratio.
The
weighted
average
is
1.82%
in
terms
of
the
weight
cost
of
the
rate
of
return.
D
1123
you
have
a
5.8%
triple
B
rating
70%
4.06
would
be
the
weighted
average
for
that
portion
of
the
return.
That's
224
basis
points
to
summarize
on
the
cap
rate,
the
historic
difference
between
the
rate
counties
rate
and
the
10-year
T
bill
is
3.45.
You
need
to
add
194
basis
points
to
get
there.
County
sales
indicate
you
should
go
up.
D
1.97%,
the
taxpayer
went
up,
2%
cost
of
financing,
went
up,
2.24%,
10year
T,
Bill,
2.36%,
Triple,
B
corporate
bonds,
3.1%.
We
went
with
2%
because
we
felt
that
looking
at
the
County's
information
2%
was
supported
by
the
County's
own
information,
despite
the
fact
that
a
higher
increase
in
cap
rates
for
a
well
stabilized
property
is
reasonable.
D
Rent
on
page
seven
Drea
uses
states
that
the
rent
is
$43
I.
Invite
you
to
look
at
page
seven
and
you'll
see
that
the
county,
rounded
up
the
actual
face.
Rent
was
4265.
If
you
take
the
occupied
office
and
the
total
rent
for
office,
reducing
that
by
10%,
you
get
3839
taxpayer
uses
3839
in
the
test.
Drea
uses
$40
vacon
office
space
Raa
uses
$39
the
asking
rent
on
page
eight
of
the
appeal
in
the
County's
part
$
3975.
The
asking
rent
lest
10%
is
3577.
There
were
four
leases
signed
in
2021.
D
They
appear
on
page
55
to
61
of
the
package.
Bas
reel
rate
of
3885
after
concessions.
351
351
is
what
the
taxpayer
used,
despite
the
fact
that
there
was
one
lease
signed
in
2022
at
a
face:
rent
of
$37
and
3131.
After
concessions
expenses,
2019
$106
escalated
at
3%
a
year
gets
you
to
1143
taxpayer
uses
1087
the
test
uses.
D
D
Owners
find
themselves
in
and,
as
such,
I
don't
believe
you
would
pay
the
same
amount
for
a
two-year
for
a
rental
that
you
didn't
have
the
same
amount
of
time
to
earn
income
on
conclusion,
rent
on
occupied
space,
3839,
rent
on
vacant
space,
3501
vacancy
rate,
30
expenses,
1087
cap
rate
up
2%,
lease
up
term
2
years
summary,
the
loan
balance
surrendered
and
hearing
request
denied
thank.
J
Yes,
good
morning,
for
this
case,
it's
compared
to
the
next
office
case
you
can
see
and
make
the
comparison
that
the
County's
guidelines
do
account
for
the
market
rent
and
adjusting
that
market
rent
in
lie
of
not
changing
the
Capal
rate
and
that's
what
our
sales
had
suggested,
that
our
cap
rates
were
actually
should
be
decreased.
However,
in
lie
of
that,
we
did
make
adjustments,
as
I've
stated
in
previous
cases,
that
we
made
adjustments
based
on
concessions
and
adjusting
the
market.
Rent
and
you'll
see
that
difference
in
this
case
versus
the
next
case.
J
So
in
particular,
in
this
case,
you'll
see
that
the
original
2023
assessment
we
overstated
the
amount
of
vacancy
in
the
building,
whereas
it
it
was
at
88577
Square
F
feet
now.
Comparing
that
to
what
we
tested
in
column,
F,
we
adjusted
downwards
to
77,6
square
ft,
similar
to
what
the
proforma
in
column
G1
is
stating
as
the
appellant
agrees
with
the
square
foot
adjustment.
J
Now,
when
we're
comparing
the
column
e
to
E1,
I
just
wanted
to
walk
you
through
that
the
operating
year
2022
reported
they
didn't
include
again
the
77,6
33
square
feet
of
projected
income
that
the
county
asked
for
is
you
know
for
the
gross
potential
of
the
property?
Now,
if
you
see
in
the
gross
potential
comparison
in
in
row,
seven
When,
comparing
column,
E1
you'll,
see
the
difference
there,
that
the
county
reconstructed,
the
2022
INE
imputing,
the
agents
numbers
of
about
2.7
million,
so
about
$2.7
million
of
imputed
income.
J
J
This
is
minus
the
25%
guidelines
and,
in
addition
to
that,
an
increase
in
expenses
that
we
show
in
the
test
now
again
I
remind
you
that
we
decreased
the
amount
of
vacant
square
footage
for
this
property
in
the
test
and
as
a
result,
we
are
showing
a
confirmation
for
this
property
and
upon
inspection
on
July
13th.
We
viewed
this
property
and
we
noted
that
the
there
were
some
renovations
to
the
lobby.
Fitness
center
conference,
room,
lounges
and,
and
this
to
us
indicates
an
increase
in
effective
age.
J
This
building
is
currently
at
1987
original
buil,
no
adjusts
made
to
the
effective
age
now.
I
didn't
include
that
in
this,
in
this
packet,
I
did
Show
an
example
actually
of
what
that
would
do
to
the
the
value
of
the
property.
Had
we
changed
that
effective
age
now
for
purposes
of
this
review,
I
didn't
I'm
not
recommending
that
effective
age
change,
but
by
virtue
of
keeping
it
as
original
at
1987,
it
does
still
show
a
confirmation
now,
in
particular,
our
gross
potential
income
versus
a
reconstructed
income.
J
We
are
626,000
lower
than
what
is
reconstructed
in
the
gross
potential
income
of
the
property.
Our
average
expenses
over
the
four
years
is
about
a
million
27677.
The
county
is
higher
than
that
and
higher
than
the
last
three
years
at
$9.7
for
the
expenses,
so
we're
project
projecting
higher
than
what
they've
ever
shown,
except
for
the
year
2019.
J
And
then
we
understand
that
this
property,
when
we
tested
the
the
last
three
years,
were
about
171,00
639
higher
than
the
last
three
years
of
the
gross
potential
income
and
the
appellant
is
showing
that
they're
lower.
If
you
see
her
the
noi
on
row
19
and
compare
that
to
what
they
reported
in
the
original
2022
INE
column
e.
So
if
you
compare
column
e
to
column,
G1,
the
appal
projecting
an
even
lower
net
net
operating
income
when
including
7793
3,
Square
ft
of
vacant
space
to
be
leased.
J
Whereas
if
you
compare
the
Cy's
noi
figure
compared
to
what
the
Reconstruction
would
be
if
they
included
that
income,
we're
projecting
still
lower
of
about
600,000
lower
than
what
the
projected
income
should
be,
and
on
top
of
that,
reducing
it
more
based
on
the
excess
vacancy
deductions
below
the
line,
so
we're
we're
at
about
maybe
4
million,
almost
5
million
in
excess
vacancy
deductions
below
the
line
on
top
of
being
$600,000
lower
than
what
the
projected
income
should
be.
J
So
with
that
I
do
ask
that
the
board
confirm
this
case
and
I'm
open
for
questions.
Thank
you.
A
Okay,
thank
you.
Both
questions
from
board.
F
Matkin
thanks
I
have
a
couple
questions.
First,
I
want
to
make
sure
I
got
this
right.
I
I'll
send
this
to
the
department.
Looking
at
the
below.
The
line
from
the
test
am
I
correct
that
it's
that
that,
as
of
data
value,
the
vacancy
was
a
little
over
35,000
square
F
feet,
meaning
it
was
about
25%
vacant.
F
This
is
a
write
up
from
the
the
department,
so
I
want
to
make
sure
the
appellant
is
on
board
with
this
or
not
on
page
two
of
151
under
the
appellant.
The
the
second
bullet,
the
third
line
says
the
most
recent
lease
was
a
face
value
of
$37.
What
we
were
talking
about
is
the
39.50
originally
projected
by
the
department
that
was
subsequently
reduced
to
$39.
A
square
foot
is
still
way
too
high,
so
you
mentioned
on
the
third
line,
the
most
recent
lease.
That's
what
you're
referring
to
in
that
second
bullet.
D
F
Okay,
I'm
getting
a
little
spam
in
the
background,
I
apologize
now
also
for
the
appal
and
on
page
three
of
151
number,
four
op
operating
expenses.
You
refer
down
about
two-thirds
of
the
way
down.
On
the
the
first
figures
on
the
line
there,
$8.94
per
square
foot
of
operating
expenses-
I
don't
see
that
anywhere
on
the
on
H
page
five,
the
INE
summary
seat
you're,
referring
that.
F
Before,
on
page
three
of
operating
expenses,
about
two-thirds
of
the
way
down,
in
that
paragraph,
it
says
$8.94,
a
square
foot
is
assumed
by
the
assessment
understates,
the
actual
stabilized
expenses-
oh
okay,
great
I,
did
just
didn't
see
the
number
anywhere
the
department
used
that
have
I
missed
it.
Obviously
I
missed
it.
D
So
if
you
go
to
the
Department's
test,
the
original
assessment,
the
the
original
23
assessment-
is
what
Mr
Peralta
is
referring
to
and
the
original
assessment
used
1,269
359
in
operating
expenses.
And
if
you
divide
that
by
the
square
feet
you
get
to
8.94.
F
F
No
looking
anywhere
anywhere,
you
want
and
the
test,
it's
$972
cents,
a
square
foot.
D
So
basically,
I
think
where
we
came
down
on
expenses
and
I'm,
not
sure
what
the
department
has
or
how
they
come
up
with
their
numbers.
Is
we
looked
at
the
2019
the
last
time
the
building
was
physically
stabilized
was
1016
and
we
escalated
3%
and
that
gets
you
to
1143
and
we
actually
used
1087
the
test
used
I
for
my
calculations,
972.
J
Okay
for
the
original
assessment,
we're
at
$925
for
the
office
income,
vacant
office,
income
and
Retail
income.
So
if
you
take
25
or
$925
from
those
figures
actually
I'm,
sorry,
that's
look
at
beable
hold
on
one.
Second,
let
me
just
see
it's.
E
J
F
Well,
I
mean
I,
think
it's
simpler
than
that:
okay,
they
they're
defending
it.
That's
that's
great
last
question.
The
appellants
brought
up
a
couple
of
times,
including
this
case,
that
the
department
is
using
figures
from
July
of
2023
three
after
the
DAT
of
value
after
the
assessment
period,
and
therefore
it's
fair
for
you
to
use
2023
figures
as
well.
Could
you
remind
me
what
what
number
or
or
or
project
or
event
or
activity
it
happen
in
July
of
2023,
that
they're
using
in
their.
B
F
D
App
so
what
we're
are
looking
at
is
we're,
saying:
hey
the
county
is
looking
at
they're
inspecting
the
property
they're,
bringing
up
information.
They're
saying
this
was
the
occupancy
on
in
July.
When
we
were
there,
it
looked
great,
and
so
there
it's
colors
the
cases
and
and
what
we're
saying
is
you
know
and
we're
not
even
including
information
from
2023?
But
what
we're
saying
is
hey.
The
county
is
doing
this.
D
D
Well,
the
vacancy
rate,
as
of
it's
basically
the
same
as
of
January
1
2023,
as
it
is
now
about
50%,
so
that
really
hasn't
changed.
What
did
change
is
the
property
has
gone
back
to
the
lender,
with
debt
of
$31
million
the
owner
said
this
property
isn't
worth
$31
million,
so
here
lender,
you
can
take
it.
Okay!
Well
that
again,.
A
D
I
think
that,
in
the
notes
there
is
information
that
is
included
from
2023
and
I
believe
that
in
the
the
Drea
reconstruction
of
the
income,
they've
done
that
in
2023-
and
it's
it's-
you
know
like
if
Beggars,
if
horses
were
wishing
Beggars
would
ride,
you
know
it
does
not
include
any
relevant
information
in
terms
of
what
actual
rents
are.
As
of
January
1
2023,
it
doesn't
include
the
deductions
to
get
that
space
leased
up.
It
is
a
complete
fabrication
of
information.
A
J
J
Yes,
so
with
this
2023
assessment,
this
represents
a
netive
10.5%
reduction
from
the
22
assessment,
and
so
you
know
even
looking
at
what
we
tested
in
in
the
reconstruction
and
in
our
final
review
of
this
property
in
column,
F
we're
still
600,000
below
what
the
projected
income
should
be
for
this
property
based
on
that
vacant
square
footage
projected
income,
so
I
do
ask
the
board
to
confirm
this
case.
J
D
Noi
at
this
property
in
2022
was
$2,515
th000.
The
test
has
income,
that's
almost
$700,000
more
than
that.
The
owners
don't
provide
rent
on
vacant
space
because
they
have
no
idea
what
the
rent
is
going
to
be,
and
the
county
is
asking
for
certification
for
Mr
Peralta
to
estimate
what
the
rent
would
be
on
vacant
space
is
and
or
for
the
board
to
rely
upon
that
is,
is
just
complete
speculation.
The
income
at
this
property
has
declined
from
2019
to
2022
by
46%
it
declined
by
11%.
Last
year,
property
is
50%
vacant.
D
It
was
surrendered
to
the
lender
when,
at
a
time
when
the
loan
balance
was
$31
million,
the
expenses
initially
used
and
I'll
just
throw
this
in
appear
on
the
County's
worksheet
at
$8.75
on
page
38
of
our
appeal
package.
But
the
real
issue
here
is
is
$31
million
sets
the
upper
limit
of
value
for
this
property.
Looking
at
the
actual
income,
it's
declined.
Market
cap
rate
should
go
up.
F
Matkin
I,
there's
no
question
this.
This
building
isn't
doing
well
and
a
a
double-
digit
decrease
is
is
warranted,
whether
it's
10
or
20
I'm,
not
sure
I
kind
of
liked.
F
All
two
two
comments:
one,
the
noi
in
the
test
case
in
the
test
column,
is
lower
than
the
reconstructed
appellant
actuals
from
2022,
which
supports
what
I
just
said
and
and
and
second
I
I
I'm
I
I
could
certainly
be
suede
that
the
imputed
value
of
the
vacant
space
is
less
than
the
decreased
from
the
original
assessment
values
that
the
department
provided,
meaning
those
from
column,
D
versus
those
from
column,
f,
but
I,
don't
know
how
much
I
have
one
data
point,
namely
the
the
lease
that
was
signed
in
March
of
2022
at
a
face
value
of
37,
let
alone
what
its
actual
value
is
over.
F
The
life
of
the
lease,
so
I
would
be
persuaded
to
take
a
lower
number
and
run
some
numbers
or
keep
it
the
way.
It
is
so
I'd
like
some
feedback
on
that,
and
so
that's
the
only
qualifying
comment.
I
have
for
not
supporting
it
as
it.
The
assessment
has
reconstructed
as.
A
Is
okay
right,
I
I
I'll
jump
in
a
little
bit
here.
You
know,
I,
don't
agree
with
the
appellant's
argument
of
you
know
the
actual
income
for
2022
being
2.5
million
and
then
that
the
count
is
using
3.1
that
that's
too
high.
But
you
know
a
we're
looking
at
gross
potential,
you
know
and
then
we're
deducting
below
the
line.
So
you
know
to
kind
of
just
arbitrarily
say:
oh,
it's
just
way
too
high.
It's
not
way
too
high.
A
It's
what
they're
supposed
to
be
doing
looking
at
the
gross
potential
and
then
adjust
for
the
vacancy
I
I.
Don't
know
I
mean
to
me
this
really
comes
down
to
what
the
appellant
was
saying.
This
a
cap
rate
issue
I'm
fine
with
the
original
assessment
of
the
noi
and
then
the
adjustments
below
the
line.
You
know,
I,
don't
know
where
people
are
on.
B
H
On
sorry
about
that,
I'm,
okay,
with
the
original
assessment,
you
know,
based
on
the
below
the
line,
deductions
that
considering
that
the
vacant
space
was
much
higher
I,
think
it
compensates,
and
you
know,
looking
at
the
test,
it
makes
sense
just
to
keep
out
of
the
same
amount
right.
B
Yeah,
when
I
get
up
in
the
morning,
I
always
look
at
ARL.
Now,
that's
the
first
thing,
I
look
at
and
the
the
CEO
of
Amazon
has
ordered
his
people
to
come
back
into
the
office
three
days
a
week
and
apparently
no
one's
nobody's.
Listening
to
him.
I
think
the
cap
rate
is
too
low.
I
think
it
ought
to
go
up
a
point
and
I
think
the
value
of
this
is
around
34
million
222
400,
but
I
I
doubt
anyone's
going
to
agree
with
me.
I
F
I'
like
to
revisit,
based
on
what
barn
said,
revisit
a
comment
that
I
made
in
this
session
that
the
department
has
has
explained
several
times,
including
today,
that
instead
of
changing
cap
rates,
they
are
lowering
when
they
do
test
imputed
income
and
oftentimes
increasing
operating
expenses
to
adjust.
For
you
know
what
would
be
a
stabilized
operating
expense
if
the
building
were
significantly
occupied.
F
F
Vacant
office
line
onea
that
maybe
it
should
go
down
a
dollar
a
square
foot
for
both
the
retail
and
for
the
office
by
the
way
before
I
forget
I,
also
misspoke.
In
my
first
comments
about
the
reconstructed
amount,
I
supported
that
I
got
they.
The
numbers
are
almost
identical
from
the
original
assessment
and
the
test
and
I
got
them
backwards.
So
it's
it's
the
test,
I'm
supporting
but
again
based
on
the
logic,
Barn's
logic.
This
is
not
doing
well
logic
and
the
Department's
approach
of
of
lowering
imputed
rents.
F
Maybe
that's
the
way
we
ought
to
proceed.
If,
if
they
support
I
know,
Barnes
would
support
some
lowering
and
I'm,
not
sure
the
rest
of
the
colleagues
on
the
board
would.
I
B
The
the
the
only
reason
why
I'm
not
buying
what
the
county
is
saying
is
to
me
it's
a
bandaid
when
a
tourniquet
is
needed,
I
think
it's
yeah,
it's
a
slight
adjustment,
but
it's
still
way
below
the
reality
of
the
marketplace.
In
my.
F
F
Day
and
the
the
notion
nobody's
going
back
to
work
was
less
clearly
understood,
as
it
is
nine
months.
10
months,
nine
months
later,
right
so
I
mean
next
year.
There
may
be
some
tourniquets
being
brought
out
because
it
do
appear
that
people.
A
Aren
going
work,
I'm,
sorry-
and
this
is
over
a
10%
reduction-
sure
you
know,
which
is
certainly.
B
Warranted
right,
but
the
the
owner
couldn't
even
make
it
work
at
the
where
their
mortgage
was
the
mortgage.
Was
you
know
they?
They
just
couldn't
keep
the.
F
Building
yeah,
but
you
never
know,
as
you
well
know,
Barnes
there's
different
reasons
that
people
turn
in
properties.
They
don't
see
appreciation,
they
don't
see
lease
up
or
they
do.
You
know
it's
their
personal
assessment
of
the
market
and
and
how
much
money
they
spend
on
it
already
how
much
they're
going
to
have
to
spend
on
it
in
C
in
terms
of
Capital
Improvements
in
the
future,
in
order
to
lease
it
up
and
there's
it's
it's
a
lot
more
complicated
than
just
you
know,.
B
C
F
Guess
well,
I
I
mean
I
could
run
the
math
I
would
I
would
I
mean
at
a
minimum.
This
is
the
highest
assessment.
That's
proposed
by
the
department
that
I
would
accept.
I
I
would
like
to
lower
the
vacant
office
by
a
dollar
then
go
through
the
whole
thing,
but
that's
arbitrary
and
I
I'm
feeling
a
little
uncomfortable
about
that.
G
F
Seems
that
the
rest
of
the
board
is
comfortable,
that
what
the
the
Department's
done
is
appropriate
and
given
them
my
vote
and
and
therefore
I
can
go
either
way
and
and
I'm
not
going
to
ruin.
Anything.
Okay
has
melee
mouth
enough
for
you.
I
A
A
B
A
D
Absolutely,
for
some
reason
it's
not
letting
me
I'll
just
go
with
it,
so
this
property
was
built
in
1988.
Again,
a
hearing
was
requested,
but
but
denied
Drea
does
include
information
in
its
package
from
2019
to
20
July
2023,
the
weighted
average
lease
term
on
this
building
is
2.3
years
and
Amazon
vacated
its
short-term
space
at
this
building.
In
this
year
now
they
had
done
a
lease
that
was
for
28
months.
D
It
was
known
that
it
was
a
short-term
lease
until
they
they
moved
out
into
their
new
property
their
new
space.
The
issues
on
appeal
are
the
capitalization
rate
operating
expenses
buildout
and
absorption
period
in
terms
of
the
capitalization
rate.
The
cap
rate
that
the
county
is
using
is
disassociated
with
Market
reality.
The
sales
that
the
county
took
place
in
the
county
demonstrate
that
the
guidelines
are
wrong.
The
financial
markets
don't
support
the
guidelines.
Interest
rates
were
ignored
when
setting
the
guidelines,
and
even
corax's
report
supports
a
higher
cap
rate
than
that
used
by
the
county.
D
The
Count's
range
of
cap
rates
is
above
or
excuse
me
is
below
the
low
end
of
Mr
corax's
study
that
was
done
in
August
and
below
the
high
end
of
Mr
corax's
study.
Now,
in
terms
of
going
back
to
work,
we've
heard
from
Mr
chus
on
a
number
of
occasions,
the
world
has
changed,
I
believe
in
2022.
We
knew
people
wouldn't
go
back
to
work,
even
assuming
that
people
went
back
to
work
three
days
a
week,
as
has
been
proposed
by
Amazon
this
year,
not
last
year
on
December
31st.
D
They
they
were
still
remote
three
days
a
week
is
three
fifths,
and
you
know
it's
going
to
engender
items
such
as
office,
hoteling
and
smaller
smaller
offices,
so
I
believe
that
even
at
three
fifths
of
the
time,
we
all
knew
in
2022
that
the
great
return
to
work
was
not
going
to
happen
and
I
knew
that
on
New
Year's
Eve
I
knew
that
on
June,
31st
or
June
30th.
So
in
ter
terms
of
the
cap
rate
study
that
the
county
is
above
the
low
below
the
low
end
of
the
range.
D
Once
again,
it
had
occupancy
those
buildings
had
occupancy
of
95%
the
guidelines
state
that
the
county
was
only
77%
occupied,
the
weighted
average
lease
term
on
those
buildings.
These
are
the
best
of
the
best
with
seven
years.
Subject
have
only
2.3
years
of
of
weighted
average.
Lease
term
left
the
range
for
stabilized
assets
with
9,
25%,
occupancy
and
seven
years
of
lease
term
was
between
5.5
and
7.76.
The
county
again
is
below
the
low
end
of
that
range
at
5.4
and
below
the
high
end
of
that
range
at
7.1.
D
Again,
the
best
of
the
best
need
to
increase
cap
rates
on
the
sales
that
took
place
by
197
basis
points
to
get
to
the
Delta
between
the
cap
rate
and
the
guidelines,
the
T
Bill
rate
and
the
county
guidelines.
You
need
to
add
194
basis
points,
Sofer
went
up,
425,
Triple,
B
corporate
bonds
went
up,
310
30-year
fixed
mortgage
up
331
the
10-year
T
Bill
up
236.
The
county
simply
has
ignored
the
fact
that
commercial
property
is
an
investment
and
runs
on
the
amount
of
capital,
a
return
on
Capital
absorption.
D
Let's
talk
about
that.
We
have
negative
absorption
over
the
last
3
years:
minus
2.6
million
the
total
average
net
absorption
from
20
2008
to
2022
was
only
175,000
square
feet
in
the
county
alone,
there
is
8,,
600,000
square
feet
available,
January
1,
and
that
does
not
account
for
the
additional
2.5
million
square
feet
under
construction.
Now,
in
the
last
case,
we
actually
had
five
leases.
D
We
had
four
from
2021
at
a
weighted
average
rate
of
3501
and
one
which
is
the
rate
the
taxpayer
used
and
one
at
31
we
used
the
3501
I
would
tell
you
in
this
instance
that
the
rate
used
by
the
county
is
more
in
line
with
what
we
believe
the
rental
rate
should
be.
We
are
not
arguing
that
this
year,
but
we
are
arguing
that
the
Walt
is
2.3
years,
that
Amazon
B
vated
102,000
Square
ft.
D
That
Amazon
still
has
a
capacity
in
its
building
for
8,000,
more
workers
that
the
cost
to
build
out
vacant
space
is
$115,
not
$90,
and
that
the
rent
loss
should
be
a
negative
twoyear
adjustment,
not
a
negative
oneyear
adjustment.
This
would
be
akin
to
saying
I'm
going
to
buy
a
rental
property,
but
I'm
not
going
to
get
income
on
it
for
two
years.
You
would
not
pay
the
same
amount
for
that
property.
D
If
you
were
not
going
to
get
get
income
for
two
years,
you
would
pay
more
for
it
if
you
were
going
to
get
income
after
one
year
in
this
case,
as
in,
as
is
the
case
throughout
the
county,
you
know
a
one-year
absorption
period
is
just
too
low.
So
in
conclusion,
the
cap
rate
should
go
up
by
2%
or
200
basis.
Points
operating
expenses
should
go
to
9007,
buildout
should
go
to
115,
and
the
lease
up
period
should
go
to
two
years
now.
D
I,
don't
believe
once
again
and
I,
don't
believe.
Any
of
us
can
honestly
say
that
we
thought
there
would
be
a
return
to
work
in
2022.
It
has
become
clearer
in
2023
that
you
can't,
even
even
if
a
boss
tells
you
you're,
going
to
come
back
to
work,
it's
not
happening,
but
we
all
knew
in
2022
that
the
great
return
to
work
was
not
going
to
occur.
It
has
impacted
the
Capital
Market.
It
has
impacted
the
risk
associated
with
commercial
markets
and
investment
in
off
office
product
and
the
assessment
simply
can't
be.
J
Thank
you
for
this
property.
What
the
appellant
doesn't
state
or
doesn't
really
point
out,
is
the
three
million
in
difference
between
the
noi
that
was
reported
in
2022
versus
what
the
Department's
test
is
in
column
F
and
that's
a
$3
million
difference
there.
J
So
if
you
look
at
the
previous
years
where
they
reported
just
that
less
than
3
million
in
2021
compared
to
the
2022
in
and
then
in
column,
B
and
column
A
in
2019
2020,
so
the
Amazon
tency
has
hasn't
shown
in
the
Ines
in
previous
years,
the
one
year
that
it
does
and
which
you
know
the
county
hasn't
captured
fully,
is
when
the
she
wants
to.
You
know,
reduce
it
down
the
line
and
say
Hey.
You
know
they're
not
in
the
building.
J
You
shouldn't
really
take
in
consideration
that
income,
so
what
we
did
in
the
County's
test
was
we
did
both.
We
didn't
take
that
consideration
if
you
compare
a
column
e
to
column
F,
just
in
the
noi
alone.
That's
a
difference
of
you
know
a
Delta
of
three
million
and
in
addition
to
that
below
the
line
we
accounted
for
the
102,5
12
s
12
square
feet
that
Amazon
has
vacated.
J
So
in
addition
to
being
3
million
below
less
than
in
Noy,
we
take
an
additional
that's
like
4
million
in
in
rent
loss,
8.9
in
TI
1.3
in
leasing
commissions
and
another
1.688
in
land
density
and
in
which
I've
asked.
Actually
it's
a
good
time
to
bring
that
up,
because
with
the
land
density
I
had
the
record
staff
looked
up.
J
The
information
now
I
didn't
include
in
the
pack
and
I
kept
it
in
there,
but
they
found
nothing
to
to
show
that
that
land
density
should
be
deducted
from
this
property.
If
anything,
they
did
say
that
they
they
acquired
some
density,
I
thought
but
I
don't
want
to
misspeak
and
I
have
that
reference
to
to
point
to,
but
that
land
density
is
in
question
and
it
will
be
reviewed
for
next
year.
J
But
in
all
essence,
you
know
for
this
property
we
underestimated
the
the
vacant
square
footage
in
the
real
in
in
the
original
assessment
and
by
virtue
of
our
guidelines
and
vacancy
deductions,
we're
we're
knocking
this
property
down,
another
8%
I'm.
Sorry,
another
5%,
which
the
test
represents,
is
a
5%
decrease
from
the
original
assessment,
and
you
know
looking
at
the
permits
of
the
property,
it
took
a
lot
for
this
property
to
house
Amazon.
J
If
you
will
and
looking
at
the
permits,
page
14
to9
that
just
gives
you
a
reference
of
all
the
permits
that
were
are
pulled
for
this
property.
About
$14
million
of
improvements
were
done
to
the
property.
Now
I
can't
speak
to
exactly.
You
know
what
particular
items
were
done,
but
if
you
ingest
$14
million
into
a
property,
and
then
you
don't
expect
this
property
to
increase
in
effective
age
or
the
life
of
the
property
to
increase,
then
you
know.
J
That's
that's
an
issue
that
the
department
is
dealing
with
where
I
did
know
the
effective
age
of
subject.
Property
should
should
increase
based
on
these
improvements
done
to
their
property,
so
without
including
that
effective
age
change
without
including
that
10
2,512
square
ft
of
Amazon
space
vacating
we're
we're
projecting
this
property
lower
than
what
we
did
in
the
original
assessment
and
I
and
as
I
stated
in
the
first
case,
this
is
the
opposite,
where
they're
actually
projecting
a
gross
potential
income
of
20
of.
J
If
you
look
on
row,
seven,
a
gross
potential
income
of
the
property.
You
know
when
we're
comparing
from
previous
years
again
that
that
is
showing
that
that
Amazon
tendency
or
the
leases
in
place
which
the
leases
for
this
property
have
up
to
six
to
seven
years
left
on
the
lease
and
that
represents
about
93,000
Square
F
feet
of
space,
with
leases
in
place
that
are
left
for
the
last
for
the
next
six
to
seven
years
of
increase.
J
So
we
expect
fully
for
that
gross
potential
income
to
grow
by
virtue
of
the
contract
leases
to
2
and
a
half
3%.
So
so,
when
we're
projecting
this
income,
we
did
project
almost
to
the
te
of
exactly
what
the
the
appellant
has
projected.
We
had
a
minor
difference
in
I
believe
some
of
the
miscellaneous
income
about
62784
Square
ft,
but
that's
exactly
what
was
shown
and
in
every
case
we
kind
of
look
at
what
was
actually
made
for
the
property
and
and
use
that
in
our
test.
J
So
with
respect
to
the
pent
version
of
the
income
versus
the
the
Departments,
we
are
allotting
everything
that
they've
asked
for
it's
just
a
minor
difference
in
2-year.
Absorption
is
what
they've
talked
about.
They
expect
$115
in
TI,
but
they
don't
want
the
effective
age
to
change
at
all,
even
though
they've
adjusted
for
that
in
the
in
the
ti.
But
overall,
as
I
stated
in
the
permits,
you
know
I,
that's
just
the
I
I
didn't
note.
J
The
the
lowly
fruit
I
I
just
saw
that
the
permits
over
the
years
about
14
million
represented
$4
million
at
one
time,
2.7,
4.1,
1.6
and
1.4,
and
you
know
my
my
math
brought
that
up
to
14
million
in
permits
alone
in
the
property,
so
to
suggest
that
that
property
didn't
increase
in
effective
age
over
the
years
is
is
the
Department's
issue.
But
when
looking
at
the
the
projected
income
that
should
be
taken
into
account
and
any
appraiser,
that's
appraising
this
property
would
take
that
in
account.
J
F
Nature,
eight
of
vacuum
I
have
a
an
easy
question
for
the
appellant.
You
had
made
comments
that
the
more
most
recent
leases
were
signed
at
face
and
effective
rents
lower
than
projected
correct
me
if
I'm
wrong
lower
than
what
is
assumed
by
the
county,
did
I
hear
you
right.
D
A
J
I
did
see
that
forgive
me,
but
I've
seen
a
lot
of
cases,
but
the
Amazon
lease
was
supposed
to
be
until
2024
I
understand
that
the
appellant
suggest
that
they
vacate
and
I
confirmed
that
during
the
during
the
inspection.
J
I
do
not
know,
however,
it's
unclear
if
they're
still
paying
on
the
space
or
not
but
again
the
the
elephant
in
room
is
the
projected
noi
that
that
they
reported
in
2022
versus
the
test
column,
which
we
were
$3
million
less
and
that's
the
Delta
I
do
ask
the
the
county
to
I
mean
the
board
to
confirm
the
reduction
in
the
County's
test.
Thank
you.
D
Under
went
has
undergone
a
structural
change.
Demand
is
not
there.
Amazon
entered
into
a
lease
for
a
short
term,
bumped
the
income
in
for
a
short
term
and
has
vacated
the
space,
as
confirmed
by
Mr
Carlton.
The
buildout
is
going
to
cost
$115
per
square
foot.
There
is
a
$90
per
sare.
Foot.
Build
out
is
just
not
does
not
take
into
account
the
increases
in
the
costs
of
construction.
The
capitalization
rate
is
not
supported.
The
rate
here
is
below
rate
that
Mr
corpex
came
up
with
for
highly
stabilized
properties.
There
has
been
negative
absorption.
D
No
potential
purchaser
would
assume
that
they
would
lease
up
in
one
year
and
we
believe
that
a
two-year
absorption
period
is
appropriate.
Thank
you.
B
Lawson
yeah
I
want
to
read
an
article
from
July
11
2022.
This
is
out
of
Arlington
now
the
pandemic
and
work
from
home
trends
are
causing
pain
for
owners
of
Office
Buildings
in
Arlington
and
across
the
region.
B
Arlington's
office
vacancy
rate
reached
20.8%
this
month,
according
to
data
from
CoStar
as
relayed
by
Arlington
Economic
Development,
that's
up
from
16.6%
at
the
beginning
of
20120,
as
the
pandemic
first
took
hold
an
18.7
at
the
beginning
of
2021.
As
of
the
first
quarter
of
this
year
it
went
to
23%,
so
so
that's
going
from
18.7
to
23%.
You
have
leases
that
are
being
renewed
or
new
leases
for
significantly
less
space.
You
have
interest
rates
that
have
increased,
you
have
inflation
and
the
County's
cap
rate
remains
unchanged.
It
just
it's
just
it's
not.
F
Matkin
I
in
in
this
case
I
thought.
The
the
department
has
accommodated
the
continuingly
weakened
office,
property
success
in
Arlington
and
probably
Nationwide
generally
by
including
the
Amazon
moveout,
which
is
a
big
slug.
You
know
it's
one,
almost
one5
of
the
entire
building,
not
even
you
know,
generally
we'd
see
well,
that's
you
know.
F
They're
moving
out
now
next
year
see
what
happens
and
we
don't
do
below
the
line,
because
it's
the
overall
existing
actual
vacancy
is
less
than
25%,
but
they
did
it
anyway,
and
that,
and
now
we
find
out,
they
don't
even
know
whether
Amazon's
paying
or
not
so
I
mean
there's
no
people
there
flushing
toilets
and
using
other
expenses,
landlords
operating
expenses,
but
they
may
be
paying,
and
we
don't
know
but
that
to
me
that
was
the
key
that
they
did
below
the
line
for
a
big
slug
of
of
move
out
that
didn't
occur.
F
B
Lawson
yeah
Ken,
I
I
I,
hear
what
you're
saying
and
I
respect
it.
I
think
the
problem
is
and
the
reason
I
read
that
article
is
in
order
to
lease
up
this
empty
space.
You've
got
to
take
a
haircut
or
it's
going
to
take
years
and
to
say:
well:
okay,
we're
going
to
use
a
year
we're
going
to
use
90
bucks
I
mean
it's
just
not
reality,
I
mean
it
could
take
DEC.
It
could
take
a
decade
to
lease
these
buildings
up.
B
F
What
I
see
is,
however,
that
the
county
hasn't
abandoned
its
normal
and
we've
heard
this
number
of
times
they
not
putting
words
in
their
miles
and
and
I,
don't
believe
and
that
they
they
look
at
sales
during
the
assessment
period
And
it
lacks
and
by
definition,
these
sales
didn't
occur
on
New,
Year's
Eve
and
that's
what
they
come
up
with
and
that's
what
they've
always
done
when
the
Market's
robust,
when
it's
declining
and
I
and
I'm
as
sympathetic
as
I,
am
to
office
property
owners.
F
That
is
a
an
element
of
how
they
and
their
their
colleagues
around
the
state
or
country.
Do
it
I
mean
that
that's
how
you
get
a
cap
cap
rate,
what
it's
sales
and
gonna
be,
and
and
if
we're
in
the
same
no
cap
rate
change
next
year,
I'
sure
love
to
see
the
the
the
sales
for
2023
I'd
be
surprising,
that
they
stayed
stable
and
but
we'll
find
that
out
a
year
from
now,
but
for
this
year
they
they're
they're
consistent
and
that's
that's
really
key
to
our
whole
process.
Consistency.
H
Penanda
I
agree,
I
mean
I,
think
the
county
has-
and
this
is
not
a
first
time
argument
that
we
hear
this-
that
you
know
the
the
market
is
just
going
bad
and
it's
going
to
last
forever.
I
mean
I've
been
on
the
board
for
over
15
years
and
I
we've
heard
this
before
and
you
know
it
doesn't
really
happen
that
way
a
lot
of
the
time.
So
it's
hard
to
really
predict
you
know
more
than
2
three
years,
I.
H
Think
in
my
opinion,
that's
why
I
think
you
know
when
we
look
at
each
assessment,
I
think
we
we've
done
it
I
think,
in
my
opinion,
in
a
correct
way
to
look
at
year
after
year.
So
you
know
I'm,
okay,
with
the
assessment
the
way
well,
the
revised,
although
I
increased
the
expenses
a
little
bit
and
it
does
change
some
on
the
final
number
I
increased
it
to
$9
instead
of
$875,
but
I'm,
not
sure
if
anybody
else
would
be
inclined
to
do
anything
like.
H
H
H
Reported
I'm
looking
at
the
revised
assessment
and
making
the
change
on
the
expenses
at
$9
and
that's
still
a
reduction
of
almost
6%
from
last
year.
You.
H
I
You
know
we're
looking
at
this
every
year
and
what
that
occupancy
is
and
what's
getting
leased
up.
I
and
it's
you
can't
I,
don't
believe.
Yes,
I
hear
everything
and
we
can
you
know
making
projections
of
how
long
10
years
this
could
take
or
two
years
what
we
don't
know
we're
looking
at
it
at
the
time
of
the
of
for
the
assessment
period
and
it's
adjusted
every
year,
I'm
fine
and
I
I
could
go
with
Jose's
I
mean
it's
a
minor
adjustment.
B
F
B
Yeah,
this
will
be
my
final
comment.
I
promise
guys,
you
know
what
Jose
you
made
a
great
point,
and
until
this
year,
I
refus
to
consider
cap
rate
changes,
because
I've
I've
seen
how
many
times
we've
had
owners
argue
my
property
sucks.
It's
terrible.
It's
not
worth
anything
and
then
two
weeks
later,
I
read
that
it
just
sold
for
more
than
the
more
than
the
assessed
value.
I.
B
Think,
though,
that
with
office
I
think
that
we
have
a
total
different
approach
to
how
it's
going
to
work
from
now
on
and
I,
don't
know
when
it'll
get
right
again.
Maybe
it'll
never
get
right
again,
but
I
I
see
a
fundamental
change
in
the
way
the
world
is
operating.
That's
why
I'm
willing
to
change
cap
rates
and
with
that
I'll
shut
up
Madam
chairman.
A
A
B
I,
it
takes
time
for
them
to
fall
out
you
you
have
owners
that
are
desperately
hoping
rates,
will
go
down
or
whatever
will
happen,
we're
starting
to
see
property
going
back
to
lenders.
It's
happening
right
now,.
I
A
Forward
all
right,
I
believe
Mr
penanda.
You
have
enough
votes
to
do
what
you
want
to.
H
Do
sure
I'll
go
ahead
and
move
the
reduce
the
assessment
to
17
6,
32200
and
that's
by
increasing
the
expenses
of
$9
on
the
revised.