How Many ‘Zombie’ Stores Will Be Left in the Philly Area after Rite Aid’s Bankruptcy?
Anyone hoping to catch a glimpse of Philadelphia’s architectural history by lingering in the aisles of a Center City Rite Aid, lost their chance — for now.
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In general, there’s been some appetite by the city’s tax office to consider reductions in the property’s valuation and grant relief.
“In this market right now, there have been reductions in a range of commercial properties, but there’s no hard and fast rule,” said Peter Kelsen, partner at law firm Blank Rome, who specializes in real estate taxes. “The [city’s] revenue stream drops because the assessment is reduced, but there are other properties that are being just developed or are doing very well and their taxes are raised because their values are going up. So it’s a little bit of a balance.”
But what if there was a tax abatement on a building that’s now vacant?
“When they’re active even though there’s a real estate tax abatement that covers the real estate side tax property of the ledger but the property also generates occupancy taxes – those don’t get abated,” he said. “Now when it closes or is vacant the abatement is still in place for the real estate taxes as it would have been if it was active but now they don’t pay an occupancy tax because you only pay that when there’s active space.”
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"How Many ‘Zombie’ Stores Will Be Left in the Philly Area after Rite Aid’s Bankruptcy?" by Kristen Mosbrucker-Garza was published in WHYY on January 30, 2024.