Chicago Loop commercial property values drop 7.2% amid vacancies
Commercial property values in Chicago’s Loop, the city’s central district of skyscrapers, financial firms and offices that drives much of its economy, dropped by about 7.2% last year amid lower sale prices and vacancies, according to a report Monday from the county treasurer.
The Loop’s commercial properties’ assessed value fell $379.2 million, according to the 2024 tax year bill analysis by Cook County Treasurer Maria Pappas. That led the taxes their owners pay to drop to $992.4 million from more than $1.1 billion, according to the report. Taxes assessed for any given year are paid the following year in two installments.
“When the Loop gets a cold, the rest of the city gets pneumonia,” Pappas said in a statement. “Homeowners across the city are paying the price. I’m particularly concerned how lower-income homeowners in struggling communities are going to be able to pay their bills.”
The declining commercial real estate values underscore the city’s slow recovery since the pandemic. Vacancy rates in Chicago and in other large cities with central business districts have continued to remain high and sale prices in many cases have plummeted.
The impact of the drop in commercial property tax bills is being felt beyond the district’s limits and in other types of property, according to the report. In Chicago, taxing bodies set the size of the levy and it is then divided up among all types of property owners including owners of high rises, warehouses, apartment buildings and single-family homes.
For tax year 2024, Chicago homeowners will pay $469.4 million more than they did the year before while industrial property taxes increased by $73.5 million due to the tax shift from commercial to other properties given Chicago Public Schools and other local governments sought half-a-billion dollars more than a year earlier, according to the report.
Property taxes in Chicago can be political flash points. The vast majority of property taxes go to fund the city’s underfunded pensions. Last year, the city council unanimously voted against Mayor Brandon Johnson’s proposal to raise property taxes by $300 million.