The departure of businesses from the Bangor Mall has contributed to a steep cut in the property’s assessed value for the second straight year, leading to a corresponding drop in how much property tax it will owe the city this year.
The mall’s leasable property now has an assessed value of $34.5 million for the 2020 fiscal year that started in July, down 27 percent from last year’s assessment of $47.4 million.
The new assessment cuts by almost $300,000 how much the city can expect to receive in property taxes from the mall after a trio of New York real estate investors purchased the property in April for substantially less than its assessed value.
For the first time since the late 1990s, the city will be owed less than $1 million in property taxes from the 41-year-old mall, according to Bangor City Assessor Phil Drew. However, the city has depended less on the Bangor Mall for tax income in recent years. Despite the drop in the mall’s value, the total amount of taxable property in the city has actually risen since last year, from $2.58 billion in the 2019 fiscal year to $2.65 billion this year, according to assessment records.
While no major anchor stores left the mall last year, there were some smaller tenants — such as Dairy Queen — that did leave, according to Drew.
“We’re still seeing continued loss of occupancy in the mall core,” Drew said.
Because the city’s assessment of the mall is based on how much income it can generate, Drew said that he considers a number of factors, such as the condition of its facilities and the types of goods and services that tenants offer.
Some local officials and current tenants have complained that the dozens of potholes in the parking lot and private access road around the mall have driven customers away.
The new appraisal follows a similar drop in value last year, when the mall’s assessed value fell by 22 percent, from $60.9 million in the 2018 fiscal year to $47.4 million last year.
The mall is now owned by a group of real estate investors based in Great Neck, New York, that has been buying up distressed malls across the country: Mason Asset Management, Namdar Realty Group and CH Capital Group.
They bought the Bangor Mall last April for $12.6 million — a fraction of its assessed value — after it went up for auction, but no bidders met the reserve price of $14.95 million.
Elliot Nassim of Mason Asset Management was not available to talk this week because he was conducting business outside the country, according to one of his employees. The other owners referred all questions to him.
The dropping value of the Bangor Mall is simply the result of the city’s updated assessment of the property’s value, not the result of any request for a tax break from the owners.
The mall’s former owner, Simon Property of Indianapolis, requested tax rebates from the city for its 2017 and 2018 assessments, arguing that the property was worth less than what the city said it was worth. After the city denied those requests, it appealed both of them to the Maine State Board of Property Tax Review.
Drew said that he has not been contacted by the mall’s new owners.
He also said there were no other Bangor properties that had a similarly large drop in assessed value this year.
However, the city has reduced the assessed value of the Walmart on Stillwater Avenue from about $19 million to $17 million for this year as part of its response to the company’s request for tax rebates for the last two fiscal years, Drew said.