Appeals court rules Giant Eagle land is worth full sale price

AMHERST — If a property sells for $11.65 million, is it really worth that much? The answer is yes, according to the 9th District Court of Appeals. It upheld Monday that Amherst Marketplace Station LLC must pay property taxes based on the full sale price of the land where Giant Eagle sits on Kresge Drive near state Route 2. Two days before Christmas in 2015, the company bought the land in what is called an "arm's length sale" — a deal where the buyer and seller act independently so there's no pressure, no chance of collusion and a better shot at getting a fair market value. That's the key here, because when Amherst Marketplace got its tax bill, it argued the Lorain County auditor's office had overcharged. It tried to convince the Lorain County Board of Revision and then the Ohio Board Of Tax Appeals that the "true value" of its property tax valuation shouldn't be based on the sale price, but on a $4.73 million appraisal. The Amherst Board of Education, which benefits from commercial properties in the city, filed a countercomplaint requesting an increase in the taxable value. The $11.65 million for the sale was the price that best reflected the fair market value, it said, and the state tax board agreed. "We argued, no that was the sale price, and it's what they ultimately decided on," county Auditor Craig Snodgrass said. Amherst Marketplace appealed. It argued that state law requires property to be valued as though it's not encumbered by a lease, such as the one held by Giant Eagle. The true value of a property is "the amount for which that property would sell on the open market by a willing seller to a willing buyer," Judge Lynne Callahan wrote for the 9th District Court of Appeals, affirming the tax boards' valuations. Snodgrass said the ruling was "a good decision for us from an economic standpoint." It both prevents the county from having to issue an enormous refund and prevents other property owners from lowering their property tax obligations. Sheffield Crossing Station LLC, which owns the land where Giant Eagle sits on Detroit Road in Sheffield Village, attempted to get the same type of tax reduction, he said. Lorain County won that case at the board of tax appeals as well. "I think this goes on to a bigger picture," Snodgrass said. "It has more far-reaching effects than just Amherst Giant Eagle. … There's a good chance this would have been tried elsewhere." Contact Jason Hawk at (440) 329-7122 or news@lcnewspapers.com.