Iowa Appellate Court Upholds $10.9 Million Commercial Property Assessment

Posted on: March 19th, 2021

A 2017 county tax assessment valued a Lowe’s store at $11.8 million. Lowe’s challenged the assessment on grounds that it was excessive. After the county review board sided with the county’s assessment, Lowe’s appealed to the Iowa Property Assessment Appeal Board (PAAB). The PAAB held a hearing on Lowe’s appeal in 2018. At the hearing, Lowe’s expert appraiser testified that the property value, based on comparable-sales analysis, was $5.2 million. An expert appraiser for the county testified that he valued the property at $10.9 million based on the property’s current use. The PAAB adopted the county’s $10.9 million valuation, finding the appraisal of the county’s expert more persuasive.

The district court affirmed the PAAB’s decision and Lowe’s appealed, arguing that the county appraisal should be rejected because it was based on the property’s current use which violated Iowa law.

In upholding the $10.9 million valuation, the Court of Appeals noted that taxpayers’ contentions that commercial property valuations could not be based on the current use of the property have been rejected in Iowa. The Court further noted that under Iowa precedent, “an assessor must . . . consider conditions existing at the time and the condition of the property in which the owner holds it.” Accordingly, the county appraisal that considered the property’s current use did not violate Iowa law.

Lowe’s Home Centers, LLC v. Iowa Property Assessment Appeal Board, No. 20-0764 (Iowa Ct. App. 2021).

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