Franklin County Reduces Hotel Tax Assessment, Saving Owner $120,000 Annually

In Franklin County, Ohio, an upper-scale hotel received a significant reduction in its property tax assessment for 2023, thanks to the efforts of law firm Vorys. The county had initially assessed the hotel at $166,673 per room, but Vorys successfully argued that the appropriate value should be $131,850 per room. This reduction will save the hotel owner approximately $120,000 annually in real property taxes.

The hotel industry has been hit hard by the COVID-19 pandemic, with many properties experiencing declines in profitability and overall value. Despite this, some county assessors have been placing values on hotels that exceed pre-pandemic levels and do not accurately reflect the current market value or income potential of these properties.

Why this matters: The successful appeal by Vorys highlights the importance of hotel operators seeking a review of their real estate tax expenses, especially in the post-COVID market where hotel real estate has not fully recovered. Time may be limited for seeking such reviews in some states, making it critical for hotel owners to act swiftly to ensure they are not overpaying on their property taxes.

Vorys' review of the Franklin County hotel's assessment found that the county's valuation exceeded the property's actual market value and income potential. By presenting a strong case for a lower valuation, the law firm was able to secure a substantial reduction in the hotel's tax burden. "The appropriate value should be $131,850 per room," Vorys stated, emphasizing the need for a more accurate assessment in light of the current market conditions.

The successful appeal in Franklin County serves as a reminder for hotel operators nationwide to closely examine their real estate tax expenses and consider seeking a review if they believe their property is being overvalued. With the hotel industry still recovering from the impact of the pandemic, ensuring that tax assessments accurately reflect the current market value and income potential of a property can provide significant financial relief for hotel owners.

Key Takeaways

• Vorys law firm secured $120K annual tax savings for Ohio hotel by reducing assessment.
• Hotel industry hit hard by COVID-19, but some counties maintain high property values.
• Successful appeal highlights importance of hotel owners reviewing real estate tax expenses.
• Vorys argued hotel's value should be $131,850 per room, not $166,673 assessed.
• Hotel owners nationwide advised to examine tax assessments and seek reviews if overvalued.