St. Charles County Medical Buildings’ Real Estate Taxes Substantially Reduced

In consolidated real estate tax appeals, SSM Health Care (“SSM”) successfully appealed the real estate property assessments dictated by the St. Charles County, Missouri Assessor (and sustained by the St. Charles County Board of Equalization) for tax years 2011 and 2012 on two of its properties. The appeals concerned two adjoining pieces of real estate:

  1. 400 1st Capitol Dr.:  a 1.79 acre tract of land improved by a four story medical office building (“400 Capitol”); and
  2. 330 1st Capitol Dr.:  a 2.08 acre tract of land improved by a four story medical office building (“330 Capitol”).

The St. Charles County Assessor appraised 400 Capitol at $4,517,600 (an assessed commercial value of $1,445,630) and 330 1st Capitol at $4,109,970 (an assessed commercial value of $1,315,190).

On appeal to the State Tax Commission, both sides (SSM and the Assessor) offered expert testimony from experienced commercial appraisers, both of whom appraised both properties using the income approach.  St. Charles County’s appraiser appraised the two properties combined, whereas SSM’s appraiser appraised the properties individually.  The State Tax Commission “found no authoritative appraisal source to substantiate” the combined St. Charles County appraisal.  Instead,  “[t]he appropriate approach to the appraisal problems was to establish the fair market value for each, not for a combined property.”

Consequently, the State Tax Commission reduced the appraised value of the respective properties as follows:

  1. 400 Capitol Dr.: true value in money at $2,537,100 (a $2m reduction), commercial assessed value of $811,870; and
  2. 330 Capitol Dr.: true value in money at $3,579,600 (a $600k reduction), commercial assessed value of $1,145,470.

Case Reference:  SSM Health Care v. Shipman (11-32949 and 11-32950)

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