►
From YouTube: Board of Equalization Hearing - August 31, 2022
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
It's
wednesday
august
31st
2022.
This
is
the
arlington
county,
virginia
board
of
equalization
hearing.
We
have
four
cases
on
the
agenda.
The
first
rpc
is
one
four
zero
one:
three
zero
four
six
boston
plaza
one
at
10,
10
gleeb
road,
and
we
have
mr
jordan
harmon
for
the
appellate,
and
you
can
start,
sir,
with
your
eight
minutes
and
tell
us
about
this
property.
B
B
So,
just
to
give
you
some
context,
this
is
this
about
a
quarter
mile
up
north
on
glebe
from
the
properties
we
discussed
last
week
at
at
the
intersection
of
fairfax
and
glebe.
So
it
is,
it
does
have
ballston
in
the
name.
However,
it
is
at
the
the
very
edge
of
of
what
could
be
considered
bolston.
This
is
getting
into
the
residential
area.
B
B
B
In
this
case,
the
court
defined
economic
rent
as
the
amount
that
a
typical
lessee
should
be
willing
to
pay
for
the
right
to
use
and
occupy
a
premises
for
a
stated
period.
The
court
also
stated
that
contract
rent
is
relevant
evidence
of
economic
right
and
is
required
to
be
considered
an
ascertaining
economic
rents.
B
This
is
the
approach
we
have
used
to
arrive
at
the
rents
listed
on
row,
one
in
column
g.
We
ascertain
the
economic
grid,
which
again
is
the
amount.
A
typical
lessee
should
be
willing
to
pay
by
considering
the
actual
contract
rates.
More
recent
leases
are
more
indicative
of
what,
unless
he
is
willing
to
pay.
As
of
the
date
of
value
than
our
older
leases,
this
property
had
13
000
square
feet
over
nine
percent
of
the
total
nla
lease
up
in
the
second
half
of
2021
and
january
of
2022.
B
These
leases
are
for
an
average
term
of
53
months
and
require
five
and
a
half
months
of
free
rent.
This
amount
of
free
rent
represents
a
10
concession
required
to
secure
these
tenants,
the
resulting
net
effective
rent
on
these
new
leases.
Again,
thirteen
thousand
square
feet,
nine
percent
of
nla,
the
net
effective
rental
rate
is
35
dollars
per
square
foot.
B
What
the
assessment
has
failed
to
consider
is
both
the
larger
and
longer
leases
at
the
property
and
the
concessions
necessary
to
sign
these
new
leases.
The
new
lease
concessions
again
are
at
a
weighted
average
of
ten
percent
of
the
face
rate.
This
gets
us
to
a
net
effective
rental
rate,
including
concessions
of
35
dollars
per
square
foot.
B
This
33
000
square
feet
set
to
expire,
represents
23
of
the
property.
As
we're
well
aware,
tenants
have
leverage
in
today's
market
to
negotiate
renewal
leases
at
a
lower
rate
than
their
previous
rent,
especially
when
their
current
rental
rates
are
well
above
even
the
asking
rent,
which
is
the
situation.
This
property
finds
itself
in
the
old.
B
B
You'll
note
that
the
parking
income
at
the
property
was
adjusted
on
the
dre8
test
column
to
match
the
actual
parking
income
received
in
2021
at
other
properties
in
in
the
county.
The
assessments
carry
over
the
actual
pass-through
income,
actual
parking
income
and
actual
other
income
to
the
assessment.
B
B
Now,
just
as
a
brief
note,
I
know
this
came
up
last
week,
but
pass-through
income
results
in
a
negative
value
when
the
landlord
collects
excess
pass-through
income
one
year
and
has
to
pay
that
back
the
following
year.
So
when
the
asses,
when
the
landlord
collects
pass-through
income,
it's
anticipated
values
that
he
collects.
B
B
We
have
seen
other
properties
this
year
and
we'll
see
another
property
next,
where
the
county
has
adopted
the
prior
year,
pass-through
and
other
income
for
the
assessment.
This
is
common
practice
at
the
drea
and
when
pastor
and
other
incomes
are
going
up
year
over
year,
it's
not
a
problem
at
all
to
adopt
the
higher
values.
However,
when
they're
going
down
for
some
reason,
the
property
is
treated
differently
in
a
non-uniform
manner.
B
Next
go
into
operating
expenses.
A
quick
note
on
this
test
page
the
operating
expenses
listed
on
the
drea
columns,
d
and
f,
are
divided
by
a
smaller
square
footage
than
the
appellant's
pro
forma
column
g.
Now,
what
this
results
in
is
those
per
square
foot
operating
expense
values
listed
off
to
the
right
hand,
side
of
each
column.
B
Those
are
not
apples
to
apples
comparisons
between
the
columns,
because,
again,
the
columns,
d
and
f
use
a
different
square
footage
to
as
the
denominator
to
divide
the
operating
expenses
into
what
this
results
in
is
columns
d
and
f,
that
per
square
foot
rate
of
ten
dollars
and
nine
dollars,
25
cents
per
square
foot,
that's
higher
comparatively
to
the
other
columns,
because
different
methodology
amongst
the
columns,
the
drea
columns,
use
a
denominator
of
140
685
square
feet,
while
the
other.
In
la
figures,
the
denominator
is
higher.
B
A
B
C
Yes,
good
morning
board,
speaking
on
this
case,
we'd
like
to
turn
your
attention
to
the
department's
column,
f
on
the
summary
page.
So,
as
mr
harman
pointed
out,
our
rents
are
slightly
higher
than
theirs
in
column.
G
and
the
reason
being
is
we
approach
all
office
buildings
the
same
way
we
look
at
the
rent
roll
and,
if
you
look
on
our
rent
roll
analysis,
you'll
see
the
exact
breakdown
of
you
know:
leases
in
place,
which
we
saw
were
at
43.95
per
square
foot
for
office
space
and
retail
42.77
cents
per
square
foot.
C
The
department
uses
six
percent
less
at
41.30
for
the
leases
in
place
and
39.50
for
the
retail
place
retail
spaces.
When
you
look
at
this
in
all
actuality,
we
are
actually
deducting
those
rants
even
further
with
the
way
our
model
has
shown
in
the
past
and
how
we
value
all
office
properties
we're
actually
using
a
negative
net,
effective
rent
of
30.98
for
the
office
in
place
and
29.63
for
the
retail
spaces
and
I'll
walk
you
through
that.
You
know
briefly
when
we
look
at
the
test
or
the
page.
C
That
includes
how
we
came
up
with
our
drea
test.
Column.
F,
you'll,
see
that
we
actually
deduct
25
from
each
of
those
figures.
C
C
It
was
actually
supposed
to
be
a
reconstruction
of
what
is
represented.
2021
was
a
column
e
is
a
reconstruction
of
the
2021
income
and
expense
that
was
turned
in.
The
figures
are
about
a
million
two
hundred
fifteen
thousand
eight
eighty
nine
to
the
dollar
off
of
what
they
actually
reported.
C
Just
to
note,
this
is
an
attempt
to
again
you
know.
I
touched
on
it
last
week
where
we
were
trying
to
reconstruct
the
actual
income
that
was
reported
in
the
property,
and
I
missed
a
mark
on
this
one.
I
should
have
had
another
column
to
represent
exactly
what
they
reported,
but
if
you
deduct
the
million
two
one,
five,
eight
eight
nine
from
row.
Seven
eleven
and
nineteen
you'll
come
up
with
the
exact
figure
that
was
reported
in
2021
ine.
C
So
when
looking
at
the
overall
valuation
of
this
property,
we
did
come
up
with
a
figure
of
nine
one,
six
hundred,
which
is
less
than
what
we
originally
had
now
keep
in
mind.
You
know
we're
using
ti's
at
seventy
dollars.
I
believe.
Last
week
we
had
an
issue.
C
I
think
in
this
case
I
think
the
pellet
agrees
at
the
seventy
dollars
a
square
foot.
We
are
slightly
off
with
the
expenses,
but
you
know
we're
about
fifty
dollars:
50
cents,
52
cents,
under
what
the
appellant
is
stating,
but
we
are
actually
over
what
was
actually
reported:
the
eight
thousand
ninety
four
cents
in
2022,
eight
dollars
in
2019,
2020,
10
and
2019
and
10
in
2018.
C
I
think
that's
all
for
now,
unless
chris
you
have
anything
else
to
add
now
I
can
just
walk
you
through
with
any
questions
you
have
regarding
why
I
think
our
net
effective
rent
is
actually
even
lower
than
what
they're
reporting
the
delta
between
what
they
actually
reported
and
our
test
column
is
quite
significant.
With
the
leases
in
place,
the
department
is
actually
reporting
about
626
000,
less
than
what
they
actually
reported
in
2021
ine
and
the
appellant
is
at
767
442
less
than
what
they
reported
in
the
2021
ine.
D
And
just
briefly
wanted
to
talk
about
what
we
stressed
last
week,
which
was
two
issues:
the
below
line
deduction
of
a
two
year:
rent
loss.
Again,
this
is
at
valor
and
property
tax,
not
how
an
investor
would
look
at
it
we're
an
annual
assessment.
We
need
to
look
at
these
on
an
annual
basis
to
determine
what
adjustments,
if
any,
need
to
be
made
and
again
seize
upon
the
map
that's
being
used
by
the
appellants.
If
I
heard
correctly
again,
the
new
leases
signed
are
five
years
with
five
free
months.
D
They
take
that
number
that
they
got
and
then
they
adjust
that
for
the
it
sounds
like
for
the
five
years
of
the
lease,
whereas
again
60
months,
you're
only
getting
five
free
months
that
six
months
are
back
to
the
contract
rent
so
taking
that
math
and
then
applying
it
to
leases
in
place
just
doesn't
make
economic
sense.
D
I
don't
know
of
any
owner
that
would
take
leases
that
escalate
year
over
year
and
ask
them
to
basically
reconstruct
their
rents
down
to
a
lower
number
based
on
the
most
recent
rents
in
place.
So
we
do
believe
that
the
projections
made
by
the
opponents
are
are
too
low
again.
Looking
at
that
to
looking
at
a
below
the
line
deduction
of
two
years,
we
do
believe
that
the
column
f
that
was
tested
is
more
appropriate
again
reflects
the
leases
that
are
in
place.
D
It
does
reflect
the
operating
expenses,
as
noted
by
wasn't
quite
sure
what
the
opponents
were
saying
as
far
as
the
denominators,
but
based
on
the
nla.
That's
in
place,
it's
a
an
increase
of
over
2021's
report
and
20.
Excuse
me,
2020's
report
and
2021's
reported
number.
We
do
believe
45
million
916
554
should
be
adopted.
Thank
you.
Okay,.
A
E
E
C
Let
me
just
look
at
the
the
county
worksheet
one.
Second,
okay,.
B
F
G
H
Yes,
thanks:
I
wanted
to
talk
a
little
bit
about
the
negative
pass-throughs.
H
H
They
are
directly,
as
everyone
should
know,
I'm
sure
that
they're
directly
related
to
the
amount
of
common
area,
maintenance
and
real
estate
taxes
and
and
property
insurance
premiums
that
landlords
encounter
from
year
to
year
and
typically
they
estimate
them
in
advance
of
each
year
and
then
they
rectified
at
the
end
of
the
year
when
the
build
the
bills
are
paid
and
then
they
can
adjust
for
the
following
year
and
sometimes
if
they
overestimate
it
in
year,
one
even
if
expenses
went
up
for
year,
two
they
may
provide
in
essence
a
rebate
to
tenants
because
they
overestimated
in
that
first
year.
H
I
don't
want
to
get
too
arcane
here,
but
I
you
know,
put
it
ready
to
sleep
and
maybe
that's
what
happens
here-
that
they're
overestimating
and
now
they're
rectifying
with
tenants,
but
what
I'm
failing
to
get
for
an
overall
building
refund.
Knowing
some
tenants
had
to
pay,
you
know
pay
some
additional
pass-throughs
in
the
next
year
and
others
got
a
rebate
for
a
net
overall
building
negative
figure
that
many
tenants
after
they're
for
all
tenants
after
the
first
year
get
an
accumulated
pass-through
amount.
H
So
as
an
example,
in
their
first
two
years,
the
the
cam
and
the
real
estate
taxes
and
all
this
good
stuff
keep
going
up
and
in
the
third
year
it
goes
down.
It
still
may
be
a
a
positive
pass-through
number,
because
the
accumulated
increases
in
what
they
need
to
reimburse
the
landlord
is
in
excess
of
the
third.
In
my
example,
third
year's
rebate,
lesser
number,
so
I'm
having
a
really
tough
time
understanding
on
a
building
wide
basis,
because
there's
a
lot
of
tenants
in
this
good
size.
H
Building
that
the
overall
rebate
is
passed
through
is
negative
or
there
is
an
overall
rebate
to
everyone.
Because,
again,
there's
a
lot
of
tenants
in
there.
Who've
been
accumulating
pass-through
numbers
for
a
number
of
years,
and
this
is
exacerbated
by
the
fact
that
I
go
to
operating
expenses
from
2020
to
2021
that
have
gone
up
just
looking
at
the
appropriate
line
18
and-
and
is
it
and
is
projected
to
go
up
yet
again,
not
at
all,
surprisingly,
for
2022
in
in
yeah
for
in
2022..
H
The
overall
building
passages
can
go
down
that
the
the
the
circumstances,
the
the
the
new
ni
that
require
so
many
tenants
to
be
new,
can
require
operating
expenses
to
dramatically
drop,
and
we
know
that
real
estate
taxes
have
been
pretty
steady
state
on
this
building
for
the
next
several
years
in
terms
of
dollars,
I'm
having
a
tough
time
with
it,
but
I
I'm
sure
I've
over
taken
my
time
because
the
numbers
are
so
small,
but
so
I'll
just
finish
with
one
question
with
the
department:
how
did
you
get
to
zero
in
your
test
case?
C
Well
it
it
should
have
been
actually
more
interesting
yeah.
If,
if
I
may,
when
looking
at
the
history
of
this
property
and
projecting
for,
we
can't
assume
that
it
should
be
zero
dollars,
it
should
actually
be
more
than
that.
If
looking
at
the
property
property's
history
overall
in
2018,
they
reported
115,
000,
20,
1950,
2020,
1119
and
then
in
2021
as
a
negative
number
again.
C
I
noted
this
last
week
where,
if
we're
trying
to
achieve
what
the
the
property
can
potentially
earn
going
forward,
you
have
to
assume
that
it's
more
than
zero
dollars.
You
have
to
assume
it's
more
than
negative,
fifty
five
thousand
dollars
and
and
to
speak
to
why.
I
think
this
year's
number
is
lower.
C
If
you
look
at
the
board
history
of
this
property,
the
the
assessment
was
lowered
last
year,
and
so
what
I
assume
happened
is
that
that
credit
per
se
was
because
the
the
assessment
was
lowered
and
it
did
overpay
in
that
sense.
But
that's
just
my
assumption.
That's.
H
G
B
These
leases
in
place
are
very
old
leases
with
much
higher
base
years
than
what
the
the
property
experienced
in
2020.
What's
reported
on,
2021
is
likely
the
rebates
coming
from
2020
and
the
best
indication
of
what
to
expect
in
the
next
year
is
what
happened
in
the
past
year.
So
that's
why
we
project
a
negative
there.
Thank
you.
Okay,
other
questions.
C
Yes,
thank
you
again
when
we're
looking
at
this
property.
We
we
do
feel
that,
based
on
our
model
that
we're
actually
having
a
lesser
net
effective
rent
than
what's
represented,
we're
deducting
25
off
of
all
rates
again.
C
The
4130
that,
with
leases
in
place,
is
actually
in
that
effective
rent
of
30.98
the
rents
in
for
the
vacant
office
at
39.50,
we're
at
29.63
when
you
deduct
the
25
percent
and
then
in
the
retail
portion,
which
we
believe
is
triple
net
yeah
we're
they're
reporting
retail
at
a
face,
ran
of
42.77
again
with
a
25
deduction,
we're
at
32
dollars
a
square
foot.
I
think
overall
we're
low
in
our
column.
C
F
again,
you
know,
as
ken
noted,
about
the
pass-throughs
we're
low
at
zero
dollars
to
assume
this
property
would
not
generate
any
income
and
pass-throughs.
It's
just
an
understatement
when,
when
looking
at
the
okay,
okay.
C
A
All
right,
I
we
gotta
keep
to
the
time
here
and
we
got
this
on
both
sides.
So
can
we
just
be
cognizant
of
when
you
have
a
minute?
It's
a
minute,
mr
harmon,
you
have
a
minute
to
wrap
up
please
or.
F
That
is,
the
market
rent
for
this
building.
That
represents
the
market
rent
on
vacant
space
and
to
use
anything
else
is
just
plain
error
in
terms
of
the
county's
representation
taking
rents
and
then
reducing
them
by
the
vacancy
rate
to
come
up
with
a
number.
It's
just,
not
right,
and
then
in
terms
of
uniformity
on
the
pass-through
income
and
the
other
income
and
the
parking
income.
F
This
property
is
being
treated
differently.
It
is
not
being
treated
the
same
as
other
properties.
It
is
not
consistent
with
how
the
county
has
handled
things
in
the
past,
and
it
is
not
consistent
with
pro.
How
will
here
on
other
properties
today
the
rent
is
too
high,
the
expenses
are
too
low
and
the
pass-through
and
other
income
are
much
too
high.
Thank
you.
E
I
agree
with
the
with
the
reduction.
I
think
there
needs
to
be
a
little
bit
more,
I'm
just
doing
I'm
looking
at
it
two
different
ways.
I
just
I
guess
the
rest
of
the
board
can
talk.
I
want
to
do
some
calculations.
H
Yes
thanks.
I
I
took
seriously
the
the
description
of
economic
grant
that
mr
harmon
described
and
and
the
response
I
thought
was-
was
reasonable,
namely
we're
taking
a
bunch
off
on
concessions,
we're
accounting
for
it
in
somewhere
else
concessions
and
vacancy
and
in
mass
appraisal.
Of
course,
it's
a
one
size
fits
all
vacancy
depending
on
the
type
of
building,
but
that's
the
best
we
can
do
given
that
this
building
is
an
80
or
some
dramatically
high
number
of
percent
vacant.
This
this
isn't
bad
stuff.
H
Also,
I
was
looking
at
the
operating
expenses
and
in
column,
f
they're.
You
know
below
what
was
reported
in
the
operating
year,
2021
and
and
in
between
that
and
what.
A
H
I
Yes,
ma'am.
Thank
you.
The
thing
that
jumped
out
at
me
when
I
looked
looked
this
over
last
night,
was
on
the
expenses
where
we
have
a
an
office
building
with
a
substantial
amount
of
vacancy.
We
have
realized
that
you
can't
go
with
the
reported
expenses.
You've
got
to
assume
that
the
expenses
go
up
due
to
the
a
more
full
lease
up
and
the
one
thing
that
jumped
out
at
me
putting
aside
rents
was
it.
I
I
think
I
think
it
was
last
week
or
maybe
the
week
before,
where
we
upped
expenses,
and
so
you
on
the
assessment
we
had
10
bucks,
we
had
10
bucks
and
then
in
the
test
it
went
to
9.25
and
so
on
the
expenses.
I
think
we
ought
to
up
that
to
the
10
and
that
that's
that's
one
suggestion
I
have
for
for
mr
hoffman.
E
That's
that's
what
I
was
calculating
and
then
one
other
thing
kind
of
jumped
out.
I
was
thinking
that
it
seemed
like
we
were
using
the
metro
cap
rate,
but
we're
kind
of
outside
the
quarter
mile
for
office
which
we
are
and
and
those
properties
over
there
to
me
are
not
metro
so
looking
at
it
operating
expenses
of
10
and
then
going
back
and
using
the
the
non-metro
effective
age
cap
rate.
E
I
I
got
roughly
the
same
number,
so
you
know
44
million
585
200
would
be
my
preference
just
just
making
the
adjustment
to
the
cap
rate.
A
H
Thank
you.
You
were
looking
down,
so
I
figured
while
you
were
calculating.
I
could
butt
in
I'm
I'm
nervous
about
saying
it's
metro
cap
rate
or
not.
Maybe
the
department
ought
to
research
that
and
find
out
just
how
far
it
is
because
I
know
they
have
a
guideline.
I
thought.
F
E
E
H
E
A
E
Yeah,
I
did.
I
did
two
things.
I
took
the
rate
on
vacancy
to
39
from
39.50,
which
is
not
huge,
but
it
reflects
the
last
three
or
four
deals
that
were
done
in
21.
E
and
then
I
did
the
10
operating
expenses.
So
I
came
out
to
44
million
0.63
500.
A
Okay,
mr
panoranda,
because
you
came
in
late,
we
can't
really
have
you
jump
in
at
this
point.
So.
J
J
But
my
opinion
was
the
same
as
cain
that
you
know.
I
think
the
vacancy
justifies
the
other
rates
on
the
rental.
That's
all.
A
I
E
You
do
that
and
then
all
right
so
on
motion
that
we
reduce
the
total
assessment
of
44
million
396
900
and
that's
just
based
on
increasing
the
operating
expenses
to
10
a
square
foot.
G
A
I
oppose
okay,
it
is
unanimous
five
to
zero,
the
the
and
that's
without
mr
penaranda.
The
assessment
is
reduced
to
forty
four
million
three,
ninety
six,
nine
hundred
based
on
increasing
the
operating
expenses
to
10
square
foot.
A
B
B
B
This
is
consistent
with
appraisal
methodology,
as
shown
in
both
the
appraisal
of
real
estate
and
iwao
publications,
which
provide
that
concessions
must
be
factored
in
when
considering
contract
rents.
This
is
the
approach
we
use
to
arrive
at
the
rents
listed
on
row,
one
in
column
g.
We
ascertain
the
economic
rent
by
considering
the
contract
rents.
B
What
we
have
done
on
column
g
line,
one
for
the
office
income
is
first
for
I'm
sorry,
this
in
place
office
income.
B
First,
we
applied
the
the
first
tenant
there
on
page
27,
you
can
see
occupies
a
very
large
footprint
at
the
property.
What
we
did
was
we
applied
their
rental
income
at
the
actual
net,
effective
rental
rate.
For
that,
for
that
lessee,
then
we
added
the
rest
of
the
occupied
space
at
the
standard
six
percent
discount
to
account
for
concessions.
B
This
is
consistent
with
the
methodology
the
county
has
previously
employed.
Typically,
when
one
tenant
occupies
a
large
portion
of
the
property,
in
this
case,
42
percent
of
the
total
nla.
The
assessment
will
show
that
tenant
on
its
own
line
item
at
the
actual
net
effective
rate,
which
is
what
we've
incorporated
to
the
in-place
leases.
B
Next,
the
operating
expenses.
Here
again,
the
drea
test
page
those
per
square
foot
operating
expense
value,
set
off
to
the
right
of
of
those
operating
expenses,
those
don't
align
with
each
other.
They
divide
in
different
values.
They
divide
by
a
total,
a
different
total
in
la
than
each
other.
This
results
in
the
drea
operating
expenses
looking
like
they're
higher
than
they
are.
B
If
we
equalize
the
denominator
on
all
of
these,
the
2018
expenses
are
actually
11.35
cents.
2019
is
12.25.
Twenty
is
eleven
dollars.
Twenty
twenty
one
is
ten
dollars:
fifty
nine
cents,
the
initial
assessment
was
twelve
dollars,
twenty
five
cents
and
then
the
test
column
goes
down
to
eleven
dollars.
Sixty
six
cents
again
2019
when
the
last
time
this
property
was
that
stabilized
occupancy
was
12.25
cents
per
square
foot,
we've
imputed
a
value
of
12.90
per
square
foot
for
operating
expenses
based
on
the
last
year.
B
B
The
the
owner
even
lists
that
page
53
is
the
2021
ind
expenses,
where
the
owner
lists
that
expenses
are
artificially
low
due
to
low
physical
occupancy.
They
noted
this
on
the
2021
ine
on
page
61
of
the
appeal
as
well.
B
So,
as
such,
you
know,
last
year,
this
property
was
unaffected
by
the
pandemic,
was
2019
when
operating
expenses
were
12.25
cents
per
square
foot
growing
this
by
nominal,
three
percent
rate
for
inflation
over
two
years,
gets
us
to
an
operating
expense
rate
of
13
dollars
per
square
foot,
and
this
makes
sense,
with
this
property
being
52
years
old
and
the
cost
of
operating
it
are
simply
higher
than
newer
buildings.
B
B
B
B
So
in
summary,
the
assessment
fails
to
impute
office
rental
rates
according
to
virginia
law,
by
not
recognizing
the
concessions
required
in
order
to
lease
up
the
property.
By
doing
so,
the
assessment
significantly
overstates
the
possible
income.
The
assessment
also
understates
the
operating
expenses
required
to
operate
the
property
at
stabilized
occupancy.
B
C
Sorry,
as
you
look
at
this
property,
you
see
that
the
property
has
been
stabilized
in
respect
to
the
vacancy
of
the
property
from
2019
to
2021.
C
If
you
follow
row,
seven
all
the
way
across
and
you
see
exactly
what
is
reported
there
and
and
what
we
have
in
our
test
and
what
the
pro
forma
is.
So
this
this
property
is
operating
at
a
higher
level
and
it's
been
stabilized.
So
when
you
look
at
the
figures
that
was
reported
in
what
we
have
done
in
our
test
column
you'll
see
it's
a
very
good
depiction
of
exactly
what
this
property
can
achieve
and
and
looking
at
the
rents
for
this
property
you'll
see
on
our
rent
roll
page.
C
We
have
rents
that
range
anywhere
from
39
36
thousand
square
foot
to
about
57
dollars
a
square
foot.
You
know
with
some
of
the
tenants
there
in
the
property.
So
when
you
compare
that
to
what
we're
actually
showing
in
our
test
column
at
38,
40,
37,
67
and
52
29
with
respect
to
the
office
vacant
office
and
retail
spaces,
what
we
don't
point
out
and-
and
what
I
should
have
explained
is
when
we
develop
our
guidelines,
we
we
do
look
at
the
different
concessions
that
are
achieved
on
every
property.
C
If
it
is
reported.
Now
I
go
extensively
into
you
know:
finding
information
and
a
lot
of
times
we
have
information
that
doesn't
show
the
exact
I
guess
concessions
per
tenant.
They
just
give
a
flat
amount.
So
these
are
the
concessions
that
they
reported
for
this
year
and
it's
up
to
me
to
find
out
and
interpret
exactly
what
those
numbers
mean.
C
C
So
I've
been
researching
this
material
and
what
I've
found
that
overall,
you
know
when,
when
a
property
doesn't
report
concessions,
that's
to
me
when
I
value
these
priorities
and
when
I
analyze
all
the
leases
in
place
and
compare
that
amongst
all
properties,
it's
inconsistent
to
say
that
concessions
overall
in
the
in
the
county
should
be
at
ten
to
twelve
percent.
C
What
I've
found
and
what
I've
adjusted
in
past
years
is
it
actually
increased
to
six
percent
based
on
the
information
I
have
and
what
was
turned
in
the
ines
and
I'm
only
as
good
as
the
information
that
is
received.
So
with
that
six
percent,
I
applied
at
six
percent
across
the
board
with
respect
to
the
rents
and
leases
in
place,
and
I
go
through
extensively
looking
at
the
rent
rolls
on
each
property
dissecting
each
tenant
and
if
available,
if
afforded
the
opportunity
to
look
at
individual
leases
on
the
property.
C
I
do
look
at
those
leases,
but
again
one
lease
doesn't
make
the
whole
market
for
office.
So
I
compare
that
to
what
I've
seen
and
I
do
adjust
based
on
what
I've
seen
and
most
of
the
time
where
that
closer
number
you'll
see
on
some
of
the
cases
that
were
supposed
to
be
heard
today,
the
same
method
that
methodology
was
applied
on
those
cases
and
three
of
the
cases
were
signed
off
on,
so
that
wasn't
addressed
early.
But
I'd
like
to
do
that
now.
So
with
respect
to
expenses.
C
What
I
also
would
like
to
note
that,
with
respect
to
expenses,
there
are
expense
stops
that
are
with
with
each
tenant,
the
details
of
which
I'm
not
too
sure
about,
but
then
with
any
access
and
expenses
the
tenant
would
have
to
pay
so
that
wouldn't
fall
on
the
expense.
Historically,
it
would
actually
be
reported
more
in
the
pass-through
income.
C
So
again,
when
we're
talking
about
pass-throughs
we're
talking
about
parking
we've
in
the
past
kind
of
grossed
up
parking,
we've
grossed
up
pass-throughs,
it's
only
in
the
last
few
years
that
we
actually
did
actuals.
You
know
I
I've
been
talking
to
senior
leadership
and
and
the
director
that
they're
things
that
that
need
to
be
changed
and
with
respect
to
how
the
ines
are
reported,
so
we're
always
trying
to
adjust
and
trying
to
be
very
clear
at
how
we
arrive
at
our
evaluations.
C
So
with
that,
I
do
ask
that,
based
on
the
test
of
this
property,
based
on
the
new
information
we
had
for
the
rents
in
place,
keeping
in
mind
that
they
do
increase
every
year,
two
and
a
half
three
percent,
that
the
reason
why
our
test
column
came
up
higher
than
the
original
assessment
is
because
of
that
two
three
percent
with
that
and
chris
did.
You
have
anything
to
add.
D
Yeah
again,
just
briefly
looking
at
page
five
and
the
rental
analysis,
this
is
almost
the
exact
opposite
of
last
case.
Virtually
every
tenant
is
in
place
for
years
and
years
and
years
to
come
to
2027
2028
2025
2034.
They
have
multiple
government
tenants
that
are
in
place
until
2034..
D
It
is
very
standard
to
have
rent
escalations
in
place
to
assume
that
you
would
be
able
to
use
the
numbers
that
are
currently
in
place
than
to
depress
them.
Just
doesn't
make
sense
for
those
tenants
that
are
already
in
place
and
again
for
years
and
years
and
years
to
come
in
regards
to
the
operating
expenses.
D
We
actually
would
agree
with
the
appellants
in
the
sense
that
if
you're
looking
at
the
history,
2019
2020
to
2021
operating
expenses
went
down,
as
the
opponents
explain
that's
due
to
lack
of
physical
vacancy,
there's,
no
reason
to
believe
that
physical
vacancy
would
increase
in
2022..
That's.
D
I
have
6
minutes
and
53
seconds
is
our
timer,
so
I
would
point
out
that
the
if
the
physical
vacancy
is
actually
going
to
continue
to
go
down
or
expect
it
to
stay,
the
same,
that
the
there'd
be
no
reason
for
operating
expenses
to
increase,
especially
not
at
two
percent
of
your
three
percent
a
year
for
two
years.
D
So
we
do
believe
that
again,
based
on
the
increases
year
over
year
for
the
leases
that
are
in
place,
given
that
the
operating
expenses
are
actually
higher
than
what
was
achieved
at
the
property
by
almost
200
thousand
dollars.
We
do
believe
that
the
test
confirms
the
assessment
at
44
million
701
one
exceeding
708.1.
Thank
you.
H
I
have
two
questions:
first,
one's
for
the
department:
you
talked
about
the
research
that
you've
been
doing
about
concessions
and
they
are
creeping
up,
which
is
by
no
means
a
surprise,
and
it's
a
a
chronic
case
that
this
and
other
appellants
have
made
this
year
and
last
year.
But
I
don't
see
in
your
test
case
that
standard
mass
appraisal,
six
percent
concessions.
Could
you
explain
that.
C
It's
in
there
when,
when
you
look
at
the
average
rent
for
this
property,
the
average
rent
in
office
is
and
eighty-five
cents,
and
we
use
in
our
test
for
thirty
eight
dollars
and
forty
cents.
H
Okay,
that's
where
it
comes
from.
Okay,
that's
how
you
accommodate
it.
Thanks
for
the
appellant
in
column
e,
the
operating
year,
2021
there's
a
concessions
dollar
amount,
a
deduction
of
course
from
income
going
towards
noi.
That's
just
about
40
of
all
income
for
2021.
Could
you
explain
that
large
number,
seemingly
large
number.
B
Yes,
sir,
mr
matt's
gonna
on
page
27,
we
outline
what
the
new
leases
were
in
2021.
A
large
amount
of
that
is
re
related
to
the
tetra
tech
that
you
can
see
the
first
tenant
listed.
They
leased
42
percent
of
the
nla
of
this
property,
their
lease
required
16.7
concessions.
B
A
C
What
we
do
is
we
weigh
those
across
the
board
with
other
properties
that
have
new
leases
and
do
not
report
concessions
when
looking
at
this
property
again,
if
we
take
that
this
property
out
of
equalization
and
adjust
the
concessions
higher
than
what
I've
used
across
the
board,
and
essentially
this
property
is
out
of
equalization,
I
don't
think
my
approach
is
incorrect
in
valuing
the
office
properties
as
a
whole,
I
asked
the
board
to
strongly
consider
the
original
assessment
at
44
708
100..
A
Okay,
thank
you
and
mr
harmon.
If
you
take
a
minute
to
wrap
up
sir.
B
Yes,
thank
you,
so
not
considering
actual
income
and
expenses
at
the
property
is
absolutely
inconsistent
with
what
the
state
law
requires
us
to
do.
Using
guideline
rates
for
concessions
is
fine
until
you're
provided
with
more
information
that
shows
this
property
is
not
operating
at
the
guideline
rate,
it
signed
42
percent
of
the
nla
at
16.7
concessions.
B
Mr
peralta
has
said
that
he
developed
the
guideline
rate
based
on
some
some
owners,
not
submitting
concession
information.
That's
essentially
punishing
this
this
owner
for
other
owners,
lack
of
responsiveness,
that's
not
that
results
in
a
assessment
that
is
well
above
fair
market
value
and
a
point
on
uniformity.
Uniformity
is
there
for
the
benefit
of
the
owner.
The
courts
have
said
that
uniformity
must
stop
short
of
assessments
that
result
in
a
value
in
excess
of
fair
market
value.
That's
what's
happened
here.
B
I
Okay,
I'll
throw
this
out
and
see
if
anyone
salutes
the
one
figure
that
I
think
needs.
Adjustment
is
on
the
test.
Column
number
one,
and
I
note
that
on
the
assessment
and
on
the
appellant's
suggested
value
that
has
gone
from
36
to
38.40,
and
so
I
think
we
ought
to
take
the
the
figure
on
line
one
and
make
it
at
36,
and
that
was
the
one
adjustment
I
think
ought
to
be
made
I'll
see
if
anyone
agrees.
E
I
I
just
I
look
at
this
building
a
little
different
than
the
last
one,
because
it's
pretty
stable,
high
occupancy,
probably
a
couple
of
the
best
credit
tenants
you
could
get
currently
so
like
barnes,
you
could
go
in
and
you
can
adjust
the
the
office
rental
rate,
but
the
reality
is
that
the
cap
rate
is
probably
going
to
be
lower
than
than
the
building
next
door.
That's
got,
you
know
a
handful
of
mom-and-pop
businesses
in
it
because
you
got
gsa
in
there
and
probably
with
some
very
specialized
spaces.
E
The
other
thing
that
that
drives
up
is
the
the
rent
in
the
rest
of
the
building
for
people
who
need
co-tenancy,
so
I'm
actually.
Okay
with
it.
I
looked
at
a
couple
comps
for
similar
buildings.
You
know
95
to
100
percent
occupied
credit
tenants
in
the
area
outside
arlington,
but
you
know,
350
355
square
foot
in
roslyn
makes
sense
to
me.
H
I
wanted
to
mention
the
the
hiccup
here
that
a
very
large
tenant
came
in
in
2021
with
a
pretty
good
deal,
and
this
is
not
shocking.
We've
seen
it
covet
related
and
commuter
related,
and
virtual
meetings
related
and,
and
we've
talked
about
this
many
times.
H
It
could
be
that
there's
a
trend
going
on
here-
and
we
also
talk
about
for
many
many
cases
in
many
many
years-
is
that
one
year
is
not
a
trend,
and
even
if
cove
abates
it
could
be
that
the
trend
of
office
and
and
retail
demand
is
lessened.
H
So
as
much
as
it
is
believable
what
the
appellant
mentioned
in
terms
of
modern
times
last
year,
I
I'm
not
ready
for
mass
appraisal
purposes,
to
consider
this
a
trend
and
take
the
whole
value
of
the
building
down.
Thank
you.
J
I
did
several
tests
on
this
case,
not
only
changing
the
rates
that
the
county
used
and
going
to
the
appellants
numbers
also
changing
the
expenses,
because
I
think
the
expenses
on
the
appellant
side
is
a
bit
high,
three
or
four
ways
that
I
did
it.
It
comes
up
to
a
difference
of
about
two
hundred
thousand
dollars
up
or
down
from
what
the
original
assessment
is.
So
you
know
based
on
that,
I'm
I'm,
okay
with
the
original
assessment.
G
A
Okay,
would
somebody
like
to
make
a
motion,
mr
hoffman.
E
All
right
a
motion
to
confirm
the
county's
assessment
at
44,
708
100.
G
A
A
I
A
B
B
I'd
also
like
to
note
that
the
noi
at
this
property
has
decreased
significantly
from
the
2019
high
water
mark.
The
issues
on
appeal
today
are
the
occupied
office,
rental
income,
the
vacant,
retail
income
pass-through
and
parking
income
operating
expenses
and
the
lease-up
period
for
the
excess
vacancy.
B
We've
provided
copies
of
the
lease
abstracts
for
these
new
tenants
in
the
appeal.
These
are
on
pages
158
through
164.
on
page
158,
you'll
see
the
first
lease
with
a
january.
2021
effective
date
carries
a
face,
ran
of
42.
and
a
term
of
91
months
with
seven
months,
free,
rent
at
seven
point:
seven
percent
free
rent
concessions.
B
This
results
in
a
net
effective
rental
rate
of
38.77,
the
second
lease
on
page
161.
This
lease
began
august
of
22.,
the
face
rent
is
41
and
it
carries
a
term
of
138
months
this.
This
lease
required
18
months
of
free,
rent,
13
of
the
term
and
results
in
a
net
effective
rental
rate
of
35.65
cents
per
square
foot.
B
B
Next,
the
assessment
imputes
55.60
per
square
foot
to
the
vacant
retail
space.
This
is
misreported
on
the
test.
Column
f
is
only
forty
four
dollars.
You
can
see
this
just
by
doing
the
simple
math.
If
we
take
the
vacant,
retail
income
listed
in
column,
f
row,
two
three
hundred
ninety
six
thousand
one
hundred
fifty
dollars
and
divide
it
by
the
vacant
retail
space
listed
there
7
125
square
feet.
B
B
Next,
the
assessment
fails
to
treat
the
pass-through
income
in
a
uniform
manner.
As
we
have
just
seen.
Other
office
buildings
in
the
county
are
assessed.
Pass-Through
income
based
on
the
prior
year
actual
figures.
We
saw
this
in
the
case
we
just
discussed
here.
The
county
is
picking
and
choosing
methodologies
to
apply
to
different
properties.
B
B
B
It
is
well
above
the
other
three
years
listed
as
reported
by
the
the
property
next,
the
assessment
imputes
operating
expenses
at
9.75
per
square
foot.
Again,
this
property
has
been
over
60
percent
vacant
for
each
of
the
past
three
years.
During
this
time,
operating
expenses
were
9.99
in
2019
8.94
in
the
pandemic
affected
2020
and
8.43
per
square
foot
in
2021
again
affected
by
the
pandemic.
B
Finally,
the
assessment
only
assumes
one
year
of
lost
rent
to
stabilize
occupancy.
This
rate
is
simply
not
grounded
in
the
reality
of
the
market.
Absorption
in
arlington
county
has
been
negative
over
the
past
two
years,
and
one
year
does
not
an
assessment.
Make
is
what
we
the
refrain.
We've
heard
from
the
county.
This
property
has
been
over
60
vacant
for
much
of
the
past
three
years.
That
is
a
trend
to
to
assume
it
will
reach
stabilized
occupancy
in
2022
is
simply
not
grounded
in
any
fact
and
results
in
the
assessment
exceeding
fair
market
value.
B
B
The
pass-through
income
and
other
income
are
imputed
at
rates
significantly
higher
than
the
prior
year.
Actual
income
supports,
which
is
not
uniform
methodology
with
other
properties
in
the
county.
The
operating
expenses
are
imputed
at
an
unrealistically
low
rate,
and
the
lease
up
period
is
not
supported
by
the
current
market.
B
C
Yes,
thank
you
just
walking
the
board.
Through
this
case,
we
don't
have
a
different
rental
rate
with
respect
to
future
leases
for
the
vacant
square
footage,
if
you
see
our
numbers
the
exact
same
number
as
the
appellants
37.25
square
foot.
I
think
that
was
a
non-issue
when
looking
at
the
leases
in
place
compared
to
the
actual
reported
income
in
column
e,
the
department
and
the
the
appellant
at
are
at
different
figures,
lower
than
was
actually
reported.
C
As
mr
harmon
pointed
out,
this
property
is
has
been
vacant
and
the
income
is
consistent.
So,
when
looking
at
this
property
and
the
rent
roll
shows
that
on
average
42.18
cents
for
the
leases
in
place
for
office
and
retail,
I
have
about
fifty
dollars
a
square
foot.
C
Now,
looking
at
the
summary
sheet,
you
see
that
our
rents
are
slightly
higher,
exactly
same
methodology
across
the
board,
six
percent
off
of
the
the
leases
in
place
and
we're
at
39.65.
C
So
that's
why
our
number
is
higher.
Theirs
is,
you
know,
somewhat
lower
when
comparing
to
what
was
reported,
the
county
is
at
5.6
percent
of
what
is
actually
reported
and
the
appellant's
at
11
of
what
was
actually
reported.
Now
you
can't
ignore
exactly
what
was
reported
on
a
property.
C
We
take
both
things
into
consideration,
what
is
actually
least
in
the
property
and
what
we
think
based
on
the
new
leases.
What
is
projected
forward
now,
because
of
that
we
were
at
the
same
number.
So
that's
again
a
non-issue,
but
with
respect
to
the
retail,
we
have
a
new
tenant
for
retailed,
at
least
in
2021,
here,
better
centers,
and
they
rented
space
about
a
thousand
fifty
square
feet
in
retail.
C
At
fifty
nine
dollars
and
thirteen
cents
now
mind
you,
the,
as
mr
harmon
pointed
out,
we're
using
a
fifty
six
dollars
and
fifty
five
sixty
dollars
and
fifty
five
point
sixty
dollars
a
square
foot
for
our
figure
there
online
on
line
two
a
and
that
that's
represented,
based
on
you,
know
reducing
what
we
found
on
the
2021
ine
as
that
new
lease
in
place.
So
that's
representative
what
the
market
can
achieve
and
that's
actually
what
the
this
property
did
sign
is
at
least
at
59
13..
C
So
that's
the
only
difference
I
see
in
the
income
with
respect
to
the
pass-throughs.
As
I
pointed
it
on
the
earlier
cases,
we
wouldn't
expect
a
negative
number
projecting
forward
on
a
property
that
again
has
leased
up,
so
we
would
think
the
number
would
be
increased
in
stabilizing.
That
number
based
on
the
history
is
not
uncommon.
I
should
have
done
it
in
the
last
case.
I
kept
it
at
zero
and
it
should
have
been
the
average
is
what
you
know
I
alluded
to,
but
in
this
case
I
did
catch
that.
C
I
did
see
that
you
know
mr
harmon
did
point
out,
there's
new
leases
that
have
signed,
and
so
we
only
would
expect
that
projection
to
be
higher
than
a
negative.
Seven
thousand
six
twelve-
and
I
think
50
000,
was-
is
within
reason
based
on
the
history
of
this
property.
C
Again,
talking
about
expenses,
they're
reporting,
eight
dollars
a
square
foot
in
2021
and
in
the
past,
what
I've
shown
in
the
test
is
higher
than
any
of
the
expenses
reported
with
the
accession
of
2019
we're
slightly
lower,
but
we
do
account
for
an
additional
below
the
line.
Adjustments
and
if
you
see
here
that
the
appellant
is
projecting
two
years
again,
we
understand
that
one
year
does
not
make
the
assessment,
but
we
assess
every
year.
C
So
if
it
warrants
another
deduction
below
the
line,
we
would
make
that
deduction
based
on
what
we
find
square
foot
vacant-wise
and
that's
all
I
have
unless
chris
has
anything
else
to
add.
D
I
apologize
I'm
not
sure
what
time
is
left
but
just
to
reiterate
again
that
looks
like
they
underprojected
the
office
income
based
on
what
was
actually
received,
based
on
the
leases
in
place
that
are
going
to
escalate
year
over
year
and
again
they
grew
the
operating
expenses
by
over
300
000
operating
expenses
dropped,
1920
and
again
in
2021.
I
don't
know
why
they
would
increase
by
over
300
000.
Again
we
don't
know
what
kind
of
physical
vacancy
is
going
to
be
incurred
at
the
property.
D
H
A
question
for
the
department
clarify
this
for
me,
please,
on
column
f,
only
on
vacant
office,
you
have
a
figure
of
39.65
that
might
be
achieved
and
on
row,
1
b
and
down
below
the
line
which
you
based
on
the
trend
of
this
building,
is
appropriate,
taking
off
below
the
line,
as
opposed
to
the
last
case
as
an
example,
less
rent
loss
is
not
39.65,
but
only
37.25
shouldn't
those
numbers
be
the
same.
If
not,
why
not?.
C
H
D
I
think
you're
just
reading
it
so
line.
One
is
for
the
office,
that's
actually
occupied.
So
that's
at
that
39.65
line.
Two
is
going
to
be
for
the
vacant
space.
H
I
see
that
little
number
above
it
yeah
that
that
is
the
the
answer:
you're
you're,
assuming
they're,
going
to
get
less
rent
in
the
future,
and
that's
why
I
take
off
a
lower
knob
thanks
a
lot
that
makes
a
lot
of
sense.
Another
question
for
the
appellant:
you
talked
about
the
long-term
trend,
which
is
pretty
well
known
of
a
high
vacancy
in
this
building,
but
you
project
from
2021
to
22
operating
expenses
going
up
36
percent,
just
looking
at
the
dollars
per
square
foot,
I'm
assuming
the
nla
hasn't
changed.
B
B
We
build
up
as
if
it's
100
occupied,
and
then
we
reduce
it
by
25
to
get
to
75
stabilized.
The
operating
expenses
reported
in
2021
are
reflective
of
that
40
occupied
building
growing
the
expenses
to
reach
that
stabilized
75
percent
occupancy
results
in
the
value
there.
If
we're
going
to
impute
income,
that's
not
earned
that's.
On
vacant
space.
We
also
have
to
build
up
the
resulting
hypothetical
expenses
that
will
result
from
those
hypothetical
leased
spaces.
Okay,.
H
C
I
don't
agree
with
the
figure,
because
what
we
we
don't
do
is
gross
up
the
parking
gross
up,
the
pass-throughs
that
they
would
incur
had
the
building
been
stabilized
and
with
low
vacancy.
H
F
That's
it
for
me.
Thank
you.
If
I
could
just
address
the
pass-throughs,
when
there
is
a
a
new
lease,
there
is
no
pass-through
income
because
that's
included
in
the
rank,
so
that
is
is
probably
an
incorrect
statement.
I
also
want
to
note-
and
I
think
that
those
of
you
involved
in
commercial
real
estate
agree
that
predominantly
what
we're
seeing
in
leases
now
is
that
the
building
must
be
as
the
base
year
is
as
though
the
building
is
either
95
occupied
or
the
or
fully
stabilized.
F
So
actual
expenses
are
say.
The
actual
expenses
of
the
building
were
eight
dollars
a
square
foot
when
establishing
a
base
year
they
may
be
grossed
up
to
95
occupancy
or
nine
dollars
a
square
foot
and
therefore
the
tenant
would
not
be
required
to
pay
pass
to
expenses
until
the
building
expenses
exceed
that
grossed
up
amount.
E
Yeah,
I
just
wanted
to
ask
the
appellant
how
many
spec
suites
are
are
available
in
the
building
right
now
that
are
all
fully
built
out.
B
E
B
We
did
tour
this
in
august
of
2021.
It
looks
like
some
space
was
still
built
out
for
the
former
tenant
who
had
vacated.
I'm
not
sure
the
square
footage
on
that
looks
like
some
may
have
been
shell,
but
I
can't
con.
F
C
Yes,
thank
you
again
for
this
property.
The
major
difference
in
income
here
was
the
retail
and
what
you've
heard
is
the
the
new
lease
in
place.
C
I
think
that,
based
on
our
test,
it
supports
the
original
assessment,
so
I
asked
the
board
to
confirm
the
25
million
911
500
respect
expenses.
If
this
property
does
not
lease
next
year
and
it
stays
the
same
and
we
have
a
credit
of
9.75
or
a
credit
of
11.50
for
expenses,
it
would
overstate
that
the
expenses
actually
spent.
Thank
you.
B
Yes,
thank
you,
so
I
want
to
clarify
that
that
vacant
office
re
retail
and
office
space
income
imputed
that
income
does
not
exist
at
this
property.
That's
imputed!
That's
hypothetical
income!
So
stating
that
that's
just
above
board!
Well,
we
have
to
also
include
the
expenses
that
will
come
with
those
hypothetical
new
tenants.
B
B
It's
a
19
premium
to
what's
actually
in
the
property,
the
pass-through
income.
Again,
they
used
a
four-year
average
look
at
the
four
years:
2018
4000
nineteen,
one
hundred
sixty
five
thousand
twenty
twenty
thirty
five
thousand
twenty
twenty
one
negative.
Seventy
six
hundred
one
of
those
is
not
like
the
others.
One
hundred
sixty
five
thousand
in
2019
is
clearly
the
high
water
mark.
That's
what's
pulling
this
average
up
to
50
000..
B
If
we
exclude
that
the
average
drops
significantly
so
to
include
one
year,
that's
probably
not
repeatable
is
not
consistent
with
what's
expected
at
the
property
operating
expenses.
Again,
if
we're
going
to
assume
a
stabilized
occupancy,
we
need
to
assume
stabilized
operating
expenses
as
well.
If
we're
going
to
have
a
75
percent
leased
up,
building
and
income
generated
from
that
additional
occupancy,
we're
also
going
to
have
increased
janitorial
utilities,
management
fees,
trash
collection
to
not
consider
those
expenses
that
are
required
with
those
new
tenants
is
simply
illogical.
Thank
you.
H
The
first
thing
is,
I
certainly
agree
with
the
appellant
that
one
small
retail
space
last
year
is
not
a
trend.
Just
like
we
talked
about
with
office
spaces.
Recent
office
leases,
but
checking
again
the
appellant
agrees
with
that
same
46-68
square
foot.
So,
even
though
I
don't
agree
with
the
county,
I
do
agree
with
their
rationale.
I
do
agree
with
their
their
the
number
that
they
apply
to
that.
So
I
guess
I'm
just
that.
I
just
put
that
on
as
complaining
for
for
pass-throughs.
H
H
There
is
no
trend
in
pass-throughs,
it's
impossible
to
go
the
last
three
years
for
passengers
like
you
can
for
operating
expenses.
As
an
example,
and
the
last
case,
the
department
went
from
a
negative
pass-through
number
proposed
by
the
appellant
to
zero.
I
would
support
that
here
as
well
for
the
same
reason,
because
it's
impossible,
although
I
I'm
after
25
years
having
a
tough
time
seeing
an
entire
building,
has
a
negative
pass-through
number
zero.
I
would
support
just
going
to
zero
and
not
fifty
thousand
plus
fifty
thousand
and.
H
And
the
last
thing
is
for
us:
we've
been
hearing
about.
You
know
imputed
income
if
it
were
plused
up
to
stabilized
versus
operating
expenses,
which
the
department
tends
to
just
look
at
strictly
as
a
trend
and
if
the
tendency
never
changed,
then
the
trend
would
be
perfectly
fine.
But
you
know
in
column
e
again
to
repeat
what
the
appellant
explained
to
me,
which
I
understood
was
that
that's
an
operating
expense,
actual
operating
expense,
but
in
their
g
pro
forma,
that's
a
plused
up.
H
What,
if
we
had
a
larger
tenancy,
both
numbers
are
correct,
but
I
can't
remember:
I
need
help
on
whether
we
go
with
the
actual
trend
or
we
go
with
the
plused
up
artificial
trend
for
occupancy,
I'm
sorry,
accounting
for
for
a
plused-up
occupancy
regarding
total
operating
expenses,
as
we
do
for
rent
income
from
office
and
retail
as
if
it
were,
you
know,
a
potential
plused-up
occupancy.
I
hope
that
wasn't
too
torture.
H
E
Yeah
I
mean
I
thought
we
did
a
good
job
breaking
this
down
when
we
reduced
it
last
year,
and
I
don't
think
it's
gotten
any
great
news
since
then,
so
it
probably
should
be
around
where
we
were
last
year,
maybe
a
little
bit
lower
based
on
operating
expenses
going
up
kind
of
industry
wide.
So
I
mean
that's
all
I
took
a
look
at
was
just
using
the
10
expenses
and
and
it's
about
a
400
000
reduction,
takes
it
down
a
little
bit
lower
than
than
last
year's
assessment.
I
I
There
was
the
bank
that's
in
there
merged
with
first
virginia
community
bank,
so
they
gave
up
an
entire
floor
of
office
upstairs
somewhere
new
management
has
taken
over.
They
just
renovated
the
whole
lobby,
which
I
don't
think
helped
at
all,
and
so
this
this
this
building
just
has
big
problems.
I
would
be
inclined
to
go
lower
than
then
then.
I
The
reduction
that
greg
suggested
I'd
be
willing
to
go
into
the
20
million
range
by
taking
the
applicant's
figures,
but
only
allowing
a
one-year
only
allowing
one
year
loss
of
rent.
But
I
don't
know
if
anybody
else
would
agree
with
that,
but
I'll
throw
that
out.
There.
A
J
Yeah
I
did
the
same,
but
I
didn't
use
the
reconstructed
numbers.
I
just
used
the
ten
dollars
on
the
original
assessment
that
brought
it
down
to
25
million
693
300.
A
E
J
E
I'm
probably
going
to
agree
with
you
next
year,
if
I'm
still
on
this
board
with
this
property,
because
here
we
are
now
it's
august
and
I
don't
think
any
major
leases
have
happened
and
cap
rates
are
getting
wider.
So,
but
for
this
year
at
least
as
of
january
1st,
that
motion
to
reduce
the
assessment
to
the
new
number
of
25
million
594
900,
based
on
10
operating
expenses,.