Plunging hotel, shopping mall values in Okanagan, Kamloops largely due to COVID-19 | iNFOnews | Thompson-Okanagan's News Source

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Plunging hotel, shopping mall values in Okanagan, Kamloops largely due to COVID-19

January 12, 2021 - 7:00 AM

While residential property values in the Thompson/Okanagan region increased last year despite COVID-19, the same can’t be said for commercial properties.

The assessed value for Orchard Park Mall in Kelowna, for example, dropped by $50 million, while the Penticton Lakeside Inn’s value dropped by $5 million.

“From what I understand, many of the hotels have gone down in value this past year,” Tracy Wall, Thompson Okanagan deputy assessor (Kelowna-Okanagan area) for B.C. Assessment, told iNFOnews.ca. “We based our assessment on what we believe they could have sold for last July 1 so, of course, many of these property types were impacted (by COVID-19) last summer.”

While assessed housing values are heavily influenced by sales of similar homes in their area, there were few hotel sales last summer so, while those sales were factored in when applicable, they were a smaller factor than in the residential sector.

The same was true for commercial properties like shopping malls, Wall said, although some, like Aberdeen Mall in Kamloops, actually increased in value.

Orchard Park is the highest assessed commercial property in the Thompson/Okanagan at $252.7 million in 2020. It was valued at $302.5 million a year earlier.

The Penticton Lakeside Resort was assessed at $35.8 million in 2019 but that dropped to $30.7 million last year.

In many cases, the value of the land did not change much. It was the value of the buildings that fell the most.

That means that the value of commercial property in the region, for the purpose of paying property taxes, is considerably less while residential property values increased.

The good news for homeowners is that doesn’t mean the tax burden shifts to homeowners versus businesses.

“The tax distribution policy is what drives the final tax rates so the tax demand itself remains what it is for the city as a whole,” Angie Schumacher, the City of Kelowna’s revenue supervisor said. “With that policy, the goal is to have an equal increase, or change, for all classes so you’re not having a shift from one class being overly burdened on another class.”

What the City does is wait until March when B.C. Assessment will post a revised tax roll as opposed to the one posted online last week. The revised roll takes into account any tax appeal decisions made this winter.

Then, cities will “delve into the complicated relationship between assessments and actual tax rates," Schumacher said.

The idea is to ensure that if, for example, businesses pay 45 per cent of a city’s tax bills, they will continue to pay that same percentage, as a group, regardless of changes to assessed values.

Here are some changes in assessed property values for shopping malls in the region in 2020 versus 2019:

KELOWNA

  • Orchard Park Mall, $252.7 million, down $49.8 million.
  • Capri Centre Mall, $56.4 million, unchanged.
  • Spall Plaza, $47 million, down $7.6 million.

KAMLOOPS

  • Aberdeen Mall, $86 million, up $3 million.
  • Columbia Place Shopping Centre, $39.5 million, up $0.7 million.
  • Sahali Mall, $29.7 million, down $6.1 million.
  • Northills Shopping Centre, $25.1 million, down $2.5 million.

VERNON

  • Village Green Mall, $73 million, down $6 million.

PENTICTON

  • Cherry Lane Shopping Centre, $66.8 million, down $6.3 million.

Here are some changes in assessed property values for a sampling of hotels in the region in 2020 versus 2019:

KELOWNA

  • Grand Okanagan, $64.7 million, down $15.5 million.
  • Manteo Waterfront Hotel, $13.7 million, down $1.8 million.
  • Ramada, $11.4 million, down $1.3 million.

KAMLOOPS

  • Coast, $16.2 million, down $3 million.
  • Delta, $12.4 million, down $2 million.
  • Best Western $7.5 million, down $1.8 million.

VERNON

  • Prestige Vernon Lodge, $7.5 million, down $1 million.

PENTICTON

  • Penticton Lakeside Resort, $30.7 Million, down $5.1 million.

To contact a reporter for this story, email Rob Munro or call 250-808-0143 or email the editor. You can also submit photos, videos or news tips to the newsroom and be entered to win a monthly prize draw.

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