The assessed value of Center City office buildings fell by over $1 billion in recent years, the Office of Property Assessments (OPA) reported to city council. That spells trouble for Philadelphia’s tax revenue. The assessed value fell from $9.82 billion in tax year 2023 to $8.78 billion in tax year 2025, OPA stated, amid persistent office vacancies and recent transactions that have seen buildings selling for far below their previously assessed value. “There are a lot of buildings in Center City that are considered to be distressed, and a number of buildings that are in bankruptcy,” said Councilmember Jeffery Young Jr., who called the hearing and who represents much of the Center City office district. “Our tax base depends on Center City.” Center City’s vacancy levels have been around 20% for over a year — more than double pre-pandemic rates — as many firms downsize their office space for the era of hybrid work. The potentially biggest blow to the city is from falling commercial real estate property tax revenues as owners challenge their valuations. Read more here.
Source: Philadelphia Inquirer; 9/30/2024