Realty Hotels, Inc. v. Tax Commission

Appellate Division of the Supreme Court of New York

Realty Hotels, Inc. v. Tax Commission

23 A.D.2d 547, 256 N.Y.S.2d 173, 1965 N.Y. App. Div. LEXIS 4938

CourtAppellate Division of the Supreme Court of the State of New York

DecidedFebruary 4, 1965

StatusPublished

This text of 23 A.D.2d 547 (Realty Hotels, Inc. v. Tax Commission) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Realty Hotels, Inc. v. Tax Commission, 23 A.D.2d 547, 256 N.Y.S.2d 173, 1965 N.Y. App. Div. LEXIS 4938 (N.Y. Ct. App. 1965).

Pincite

Opinion

Order, entered on or about September 13, 1960, unanimously reversed, on the law and the facts, with $30 costs and disbursements to the appellant, and the assessments c'onfirmed. In a proceeding to reduce the tax assessments on relator’s real property for the tax years 1956-60, the court ordered substantial reductions. We find that the record reveals that the relator failed to show that the assessments exceeded the value of the property for the years in question. The property is the Biltmore Hotel. Relator elected to proceed on the theory of economic value arrived at by capitalization of income. While this is a proper theory, the method adopted was improper. Relator’s expert did not use actual rentals of rooms, stores or public facilities but instead substituted his estimate not of what a tenant would pay but of what an operator who leased the entire premises would pay to the landlord of the fee. From this are deducted estimated expenses on the basis of managing -a hotel. Nothing- in the record supports this method as one warranted by experience of hotel operation or likely in theory to produce a reliable basis for computation of rental value. Rejection of this method leaves the record without substantial proof warranting any reduction. Moreover, had actual rentals or any reasonable rental based on experience been used and a concededly proper capitalization rate applied, the results would be a value in excess of the assessments. The trial court was unduly influenced by findings of land values made in prior applications. These are only significant for the years then under review (Matter of Lome v. Tax Comm.. of City of New York, 19 Mise 2d 803, affd. 11 A D 2d 773) and are subject to change as general market conditions change (Matter of Lane Bryant v. Tax Comm, of City of New York, 21 A D 2d 669). Concur — - Breitel, J. P., Babin, McNally, Steuer and Witmer, JJ.

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Order, entered on or about September 13, 1960, unanimously reversed, on the law and the facts, with $30 costs and disbursements to the appellant, and the assessments c'onfirmed. In a proceeding to reduce the tax assessments on relator’s real property for the tax years 1956-60, the court ordered substantial reductions. We find that the record reveals that the relator failed to show that the assessments exceeded the value of the property for the years in question. The property is the Biltmore Hotel. Relator elected to proceed on the theory of economic value arrived at by capitalization of income. While this is a proper theory, the method adopted was improper. Relator’s expert did not use actual rentals of rooms, stores or public facilities but instead substituted his estimate not of what a tenant would pay but of what an operator who leased the entire premises would pay to the landlord of the fee. From this are deducted estimated expenses on the basis of managing -a hotel. Nothing- in the record supports this method as one warranted by experience of hotel operation or likely in theory to produce a reliable basis for computation of rental value. Rejection of this method leaves the record without substantial proof warranting any reduction. Moreover, had actual rentals or any reasonable rental based on experience been used and a concededly proper capitalization rate applied, the results would be a value in excess of the assessments. The trial court was unduly influenced by findings of land values made in prior applications. These are only significant for the years then under review (Matter of Lome v. Tax Comm.. of City of New York, 19 Mise 2d 803, affd. 11 A D 2d 773) and are subject to change as general market conditions change (Matter of Lane Bryant v. Tax Comm, of City of New York, 21 A D 2d 669). Concur — - Breitel, J. P., Babin, McNally, Steuer and Witmer, JJ.

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Bluebook (online)

23 A.D.2d 547, 256 N.Y.S.2d 173, 1965 N.Y. App. Div. LEXIS 4938, Counsel Stack Legal Research, https://law.counselstack.com/opinion/realty-hotels-inc-v-tax-commission-nyappdiv-1965.