Owners of the Ballston Quarter retail-restaurant-and-entertainment complex came away from a recent Board of Equalization hearing with a very partial victory, as that body reduced the property’s assessed valuation but not nearly as much as its owners had sought.
On a unanimous vote, Board of Equalization members on July 13 voted to reduce the assessment rate – which is used to calculate the property’s annual tax bill – from $91.1 million as determined by staff to $86.7 million.
“It’s a unique property, a unique situation,” said Mary Dooley, who chairs the independent panel. Its members are appointed by the Circuit Court to adjudicate property-valuation disputes between landowners and the county government.
The vote was a small win for Brookfield Properties, the Chicago-based firm that owns the mall (known before a major renovation as Ballston Common). But the final number was far higher than the $46.4 million valuation the company had sought from the BZA, a figure board member Greg Hoffman termed “ridiculous.”
The property’s final assessment in 2021 was $85.5 million, and for a while during the 40-minute hearing it appeared that’s where the zoning panel would land on for 2022. But after some back and forth, the slightly higher number was agreed to.
Throughout the hearing, county staff had stuck by its valuation of $91.1 million. “We believe our assessment to be spot-on,” said Laurie Roskind, who did the assessment on the property.
Ballston Quarter is performing better than it did in 2021, but faces enormous headwinds, Board of Equalization member Ken Matzkin acknowledged.
“It’s suffering from COVID and the rise of e-tail,” he said.
Much of the mall’s business derives from those working in the surrounding commercial office space, but that was driven away by COVID in 2020 and has not – and may not fully – come back.
“We haven’t seen the office market in Ballston return,” Hoffman said. “Usually there would be a bunch of full office buildings. Now it’s probably 30 percent [occupied by workers].”
Board of Equalization member Barnes Lawson, who lives in the neighborhood and frequents the property often, said the mall currently has something of a feast-or-famine personality when attracting patrons.
Certain times, it will be filled with patrons, but “go there on a Thursday evening, it’s dead,” he said.
Shawn Venstrom, who represented the property owner at the hearing and suggested the assessment figure of $46.4 million, said the food court and stand-alone restaurants were performing well and the movie theater was doing so-so.
“The challenge is retail – you can’t put restaurants in every suite,” he said, pointing to an oversaturated retail market across the region.
“The leasing team is trying to do everything possible” to fill spaces, said Venstrom, who said current occupancy stands at 77 percent.
(About 23,000 square feet of space recently was leased to a religious institution, although at low rates, Venstrom said.)
The transformation from Ballston Common to a Ballston Quarter – which aimed to attract a younger and hipper crowd – was a lengthy and challenging affair that then almost immediately found itself derailed by the arrival of COVID in the late winter of 2020.
But BZA members believed there is no need to write off the future of Ballston Quarter. At least not yet.
“It’s a quality neighborhood, a quality building, a quality landlord,” Matzkin said, while acknowledging “this kind of property is nearing obsolescence.”
Ballston Quarter is located adjacent to, but does not share ownership with, a Macy’s department store. The Board of Equalization action only related to the mall, not the retailer.