Houghton property tax appeal.pdf
Devine Investment Properties Petitioner Vs. Township Of Denton Respondent · 26-001414-TT
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Page 1
Statement of True Cash Value Justification Property Location: 3741 W. Houghton Lake Dr. Houghton Lake, Michigan Parcel #’s: 003-110-025-0000, 003-110-022-0000, 003-110-024-0000, 003-110-024-0000 Building Size: 34,700 square feet Year Built: Approx. 60 years old Condition: Average Occupancy: Vacant for approximately 2 years Purchase Price: $550,000 I am submitting this statement to support the true cash value of the above-referenced commercial property for purposes of assessment review. The most reliable indicator of a property’s true cash value is an arm’s-length sale. This property was purchased in an open and competitive national commercial real estate auction, where it was exposed to a broad pool of potential buyers. The auction format ensured that the final sale price of $550,000 reflects current market conditions and the collective judgment of informed market participants. Several factors inherent to the property significantly impact its market value: First, the building is approximately 60 years old and in average condition. Properties of this age typically require ongoing capital investment, modernization, and potential structural or mechanical updates. Buyers factor these anticipated costs into their purchase decisions, resulting in downward pressure on value. Second, the property consists of a large footprint of 34,700 square feet. In a small, seasonal market such as Houghton Lake, demand for large-format retail space is limited. Larger buildings generally command a lower price per square foot due to reduced buyer demand, higher carrying costs, and increased difficulty in leasing or repurposing the space. Third, the property has been vacant for nearly two years. Extended vacancy is a critical determinant of value, as it reflects functional and economic obsolescence. A vacant property generates no income and presents significant leasing risk, which investors account for through discounted purchase pricing. Additionally, prolonged vacancy may contribute to deferred maintenance and further reduce market appeal. Fourth, the property was marketed on a national auction platform, which typically attracts value- driven and investment-oriented buyers seeking properties with repositioning potential. Such sales environments often result in pricing that accurately reflects risk, required investment, and local market limitations. The purchase price equates to approximately $15.85 per square foot ($550,000 ÷ 34,700 sq ft), which is consistent with market expectations for large, older, vacant commercial properties in similar secondary and rural markets. This pricing level reflects the realities of limited tenant demand, high vacancy risk, and the capital required to return the property to productive use.
Page 2
Given these considerations, the recent arm’s-length transaction at $550,000 provides strong and credible evidence of the property’s true cash value. Any assessment significantly above this level would not accurately reflect current market conditions or the property’s actual economic utility. For these reasons, I respectfully request that the assessed value be adjusted to align with the demonstrated market value established by the recent purchase price. Sincerely, Charles Devine, Sole member Devine Investment Properties, LLC P.O. Box 837 Perry, MI 48872