As hotels grow, property tax soars

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As hotels grow, property tax soars
2006-07-17
The U.S. hotel industry is enjoying some of its best times ever, and local tax collectors are taking note. Hotel property taxes went up by at least 10 percent in eight cities, including Miami, Charlotte and Washington, according to an analysis by Atlanta-based PKF Hospitality Research. They jumped nearly 19 percent in Dallas. The average hotel tax bill nationally rose 6.2 percent last year, the biggest annual jump since 1987, the analysis shows. "The cities and counties want their piece of the pie," PKF President Mark Woodworth says. State laws vary, but generally commercial property valuations the basis for the final tax bill consider market value and income-producing potential. Room rates to go up Laurence Geller, CEO of Strategic Hotels & Resorts, which owns 20 hotels, said the higher taxes must be offset by raising room rates, cutting costs or raising revenue elsewhere.
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