Case Study:
It is August 2018; Olivia receives some kind of notice from the government telling her that her property is going to be taxed really high. Olivia owns a property in Miami Dade County. She has owned her 30,000 square foot property with a 10,000 square foot building and 20,000 square feet of parking since 2010. Olivia’s lot has frontage on a busy highway with heavy traffic giving high visibility to her property. Olivia’s property is not a regular rectangle shape; it is sort of shaped like an oval.
Olivia bought her property during the economic downturn and felt very lucky to rent her property to Eduardo’s Empanada Restaurant, Eduardo’s sells delicious and very cheap empanadas (they were voted the best empanadas by the Miami Herald). Eduardo and Olivia signed a 30 year lease with 3, 5 year renewal options in 2010, when the market was very bad. Most other properties within 3-5 miles of Olivia’s land are smaller approximately 15,000 SF each.
Under Miami 21, a zoning change happened in Olivia’s neighborhood. She didn’t even know about it. The Zoning change allows an increase in density from 16 units per acre to 100 units per acre and allows buildings to be up to 24 stories high. All of Olivia’s neighbors are selling their properties because they think under the new zoning code, the highest and best use is to build an apartment or condo building. Olivia doesn’t want to sell her property but now the property taxes on her property are too high because the Property Appraiser is valuing her property against the other neighboring properties. Olivia was new to real estate when she bought her property and she forgot to include in the Commercial Lease that the Tenant pays the property taxes (she knows even if she included it Eduardo wouldn’t be able to pay because the income he generates from selling empanadas does not cover the increase in assessed value and corresponding property taxes.) The amount of rent that Eduardo’s pays to Olivia doesn’t cover the property taxes.
Olivia knows that through signing the lease with Eduardo, she gave him the right of possession for 30 years with options!
Based on this scenario please answer:
What notice did Olivia get in August? Who sent it to her? What rights did it give her?
You represent Olivia as an attorney, she says she wants you to file an appeal to the Value Adjustment Board. With reference to the statutes and our class lecture please argue (i) why the Just Value of Olivia’s property should be less. (ii) Please also explain to Olivia what is “Just Value” (iii) Please explain to Olivia what her options are if she can’t pay the property tax and you don’t win the case.
Your represent the Property Appraiser’s office as an attorney, with reference to the statutes and our class lecture, please argue why the high Just Value assessed on Olivia’s property is accurate.