Commercial Real Property
Commercial Real Property is valued in the State of Colorado using the Cost, Market, and Income approaches to value. All 3 methods are reviewed and the most reliable method is used to determine the final value for property taxes.
Commercial Real Property is assessed at 27.9% of the market value of the property. Every 2 years the Assessor's Office determines the current level of value using sales that occurred the previous 2 years. For example, for tax year 2023 the value is determined using sales that occurred January 1st 2021 through June 30th 2022. The La Plata County Assessor's Office also conducts a county-wide review of rents and cap rates in the same time period, "The Rent Survey". To gather this data, businesses are contacted and asked to supply information on what they pay for rent, square footage of space rented, and the conditions of the lease. This information is confidential and is collated into dollar per square foot per area and type grid, to help the appraisal team determine market rents per square foot, per use and location. This data is used to calculate the income approach to value commercial properties and to defend market value on the same properties. The cost approach is the method used to determine the replacement cost new less depreciation for improvements on commercial properties. This method is applied using the Marshall and Swift Cost manuals, and is used mainly for new construction or special use type properties.
Property owners have the ability to protest the value of their property in May following the mailing of Notices of Valuation. After the month of May, valuation review requests are looked at as late protests or abatement requests (after taxes have been billed). The value review will use all 3 methods of value. Further information is contained in our Appeals section.
The mass appraisal of commercial properties is based on location, use, quality of, type of construction, and market indicators.