New Jersey Tax Court Reduces Property Valuation Based on Taxpayer’s Expert’s Opinion Under Income Capitalization Approach

The New Jersey Tax Court May 28 reduced the property tax valuation based on Taxpayer’s expert’s opinion under the income capitalization approach. Taxpayer challenged the tax year 2005 and 2006 assessments and presented an expert’s opinion of value under the income approach. The township also presented an expert’s opinion under the cost approach. The tax court noted that: 1) the highest and best use of the property was to be rented as corporate office space to a single tenant; 2) the income capitalization approach was the most credible method, not the cost approach; and 3) Taxpayer’s expert’s market rent, building ...