According to Moody’s, commercial real estate value increased just 19% from May 2004 to April 2012. It was 120.37 in May 2004 and ended up at 143.73 in April 2012.
But in Louisville? Commercial real estate values apparently increased by a million trillion percent.
Like the fancy new VA hospital site.
In May 2004, that vacant piece of property was purchased by Blue Equity for $4.96 million. And it was just sold to the VA for $12.9 million. With the VA saying it paid a fair market price.
We’re guessing that means all commercial real estate sales in Louisville are out performing the entire national market and that all commercial real estate sales are making profits to the tune of $7 million in eight years.
Note: If the property purchased by the VA had only increased in value by 19%, it would have paid around $5.9 million. Getting a change from residential-only zoning to “allow for a six-story hotel, restaurants, retail and apartments” is apparently worth $7 million.
3 responses so far ↓
1 Mark H (Not Hebert) // Jul 12, 2012 at 12:47 pm
I think you are over-simplifying the comparison a bit. I have no doubt that the VA likely paid a premium, but is the appraisal used public record to see what the comparables are?
You are taking an average of all commercial property, and not commercial property in the Northeast End of Louisville, and what impact the completion of the Westport Road exit to I-264 and the zoning changes have had on the location. According to the PVA, the last reassessment was in 2004.
You would need to see the local compariables to determine if the taxpayers got hosed or not. Comparing the property appreciation from 2004 to now on a national basis is a fruitless exercise. An open records request for the appraisal should tell us if there was any funny business going on.
Also, what would 36+ acres of land in downtown Louisville cost the government? I’m sure it would have been more than $12.9M.
2 jake // Jul 12, 2012 at 1:16 pm
If you bothered reading the story instead of instantly going to the foam-at-the-mouth teabagger zone, you’d get the sarcasm.
See that “Possibility City” tag that we use when making fun of shit?
Jesus H.
3 The Highlander // Jul 12, 2012 at 1:16 pm
Mark H: Your last paragraph is the bullseye. Remember when the Museum Plaza folks bot the land for it to ‘go on.’ I recall it was well over 12.9m for a couple to 4 acres. It’s all kinda murky, though, because the public was always ‘excised’ from the money trail on that ‘deal’ – despite the multitude of press conferences that were conducted.
The one I remember with the biggest laugh was when the Goobernatorial and Happy Pants called a press conference ‘at site’ to announce they were going to apply for a couple hundred million loan from the federal government.
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