Blog / Legislation / City of Commerce Parcel Tax

City of Commerce Parcel Tax

The City of Commerce may (very likely) adopt its own Parcel Tax. It will require 2/3’s  approval from the voters at the November 2, 2021 general election. The parcel tax is equal to $0.20 PSF of building area and applies only to industrial properties. The tax may be adjusted by the City Council to a maximum rate of $0.3321 PSF square foot. Keep in mind cap rates are averaging 4.75%. If the Net Operating Income is reduced by $0.20 PSF this equates to $4.21 PSF in lost value based on the Income Approach to Value. Note, 85% of the land area in the City of Commerce is industrial, 10% commercial and 5% (the voters) is residential. Again, the Parcel Tax only applies to industrial land.

You can find additional information on the proposed parcel tax here: https://cloud.kiddermathews.com/index.php/s/T0pLsOYzBgkmOER