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Business Real Estate Tenants and Real Property Tax Reductions

This is the third and last installment of advisories discussing recently enacted Ohio Senate Bill 57 (the “Bill”) and its impact on Ohio real property tax reductions and exemptions. Frequently, commercial and industrial property leases require the tenant to pay all expenses attending the realty leased, including real estate taxes. However, historically, under applicable law, such a business tenant could not independently act as the party challenging the tax value of the leased property in an attempt to lower the real estate taxes which that tenant must pay under its lease.

The Bill now permits such commercial and industrial tenants to act as the party seeking to lower real estate tax values and taxes so long as (1) the property is classified as commercial or industrial; (2) the lease requires the tenant to pay all real estate taxes; and (3) the property owner authorizes the tenant to challenge the tax value. This authorization may be in the form of a provision in the lease itself or other preferably written permission by the landlord property owner.

Consequently, the Bill offers another useful tool to certain commercial tenants negatively impacted by high tax property values and their attendant real estate taxes.

If you have any questions about this topic, please contact Dana Rose or your Weston Hurd attorney.

Recent Advisories

Contact Information

Dana A. Rosedrose@westonhurd.com – 216.687.3342