Ok, this might be a dumb question but I can’t find an answer to this online (and I haven’t asked a broker). I am looking to purchase a hotel with a few shops underneath. The real estate is for sale for $2M and the hotel operating business is for sale for $1M (currently the hotel pays rent to the real estate entity). When calculating our future property taxes, should I use just the property value ($2M) or do I need to count both the hotel & real estate value in there ($3M)? Appreciate your support… any links are appreciated too so I can learn more about this.
Thank you!
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Are you buying it with debt? If so it’ll be separate loans for them and you only declare the assessed property value.
Depends on local laws.
Based on your explanation, basically there are property taxes (for building) and business taxes (rental as business and hotel as business).The evaluation will be properly taxes that are commonly based on the size of the property (zoning, type of business, etc) and business evaluation that based on business’s P/L.