Chicago appeals court has backed the Illinois Property Tax Appeal Board’s
decision to peg the value of a West Loop high-rise, situated across from Union
Station, at $74 million, brushing aside the owners’ contention it was actually worth
$58 million, saying the owners were given a fair shake and their appraisal was
“unreliable” and “confusing.”
The ruling was delivered Jan. 26 in Illinois First District
Appellate Court by Justice Margaret McBride, with concurrence from Justices
Eileen O’Neill Burke and David Ellis. The court filed the ruling under Supreme
Court Rule 23, which means it may not be cited as precedent, except in the
limited circumstances permitted by the rule.
The decision favored the Illinois Property Tax Appeal Board
in its quarrel with West Loop Associates, LLC., owners of an 18-story office
building at 550 W. Jackson Boulevard, across the street from Union Station.
The Cook County assessor valued the 16-year-old building at
$96 million for the tax years 2009 to 2011, but West Loop asked the tax appeal
board to lower that amount. The board reduced the value to $70 million, but
West Loop said the value should be cut further, to $58 million, based on its
appraiser’s report. A tax hearing was set on the matter.
The city of Chicago's appraiser stepped in and put the value
at $74 million. The city also filed a motion five days before the hearing,
demanding West Loop be barred at the hearing from disputing the city's physical
description of the building. The reason? The city alleged West Loop never
responded to the appraiser's request to inspect the building's interior.
West Loop tried to block the motion, alleging the city
“sprung” the filing at the last minute. West Loop claimed its failure to
respond was “inadvertent” and the city never tried to resolve the issue before
resorting to the motion.
The board granted the city’s motion and the hearing went
ahead, with the board raising the value to $74 million. West Loop then
appealed, claiming the granting of the motion cast a “pall” over West Loop at
McBride brushed aside the idea the motion caught West Loop flat-footed, noting
there was no deadline by which the city had to file the motion. Further,
instead of lodging a motion five days before the hearing, the city could have
simply raised the same issues during the hearing itself without a motion,
giving West Loop no time at all to prepare a response.
Loop also failed to show how it was “meaningfully curtailed” from making its
case at the hearing, especially given neither party disputed to any degree the
“description, physical characteristics, and condition of the property,”
according to McBride.
record indicates that the ruling (on the motion) did not play a significant
part in the hearing and
that PTAB was not given any reason to reconsider the ruling during the parties’
presentations,” McBride observed.
justice went on to say West Loop’s arguments about the motion were “based on
form rather than any substance.”
Loop’s appraiser also came under criticism.
pointed out the board described the appraiser’s methods as “self-validating and
contradictory to accepted appraisal practice,” with the appraiser making “illogical
and unsupported statements throughout the hearing.”
her own part, McBride said West Loop’s appraisal was “unreliable” and the
testimony of its appraiser was “confusing.”
West Loop Associates has been represented by the Chicago
firm of Fisk, Kart, Katz & Regan.
According to Cook County property tax records, the owners of
the building – which sits on three parcels with different property
identification numbers (PINs) – paid a total of about $3.67 million in taxes for the property in tax year 2015.