Banking & Finance Law Report

Tag Archives: real estate

Planning For Leasehold Financing

Commercial leases often lack leasehold financing provisions despite the significant impact such provisions can have on the business dealings of the tenant during the term of the lease.

Long-term, creditworthy tenants, those who have value in their leaseholds such as restaurants and hotels, are often prime candidates for leasehold financing. A leasehold mortgage is very similar to a regular mortgage, except that, if a default occurs the holder of a leasehold mortgage has the right to foreclose not by conducting a sale of the building, but instead by taking over as the tenant under the lease. Usually a leasehold mortgage also includes a pledge of the tenant’s personal property on the leased premises, and by foreclosing the leasehold mortgage, the mortgage holder also takes title to the personal property in the leased premises. Because giving a leasehold mortgage does not require the mortgagor to own the real property it mortgages, leasehold financing allows businesses that rent space, and rather than own property, to obtain financing for their businesses.

Many businesses eligible for leasehold mortgages cannot reap the benefits of such arrangements due to restrictions in their leases on leasehold financing. Many commercial leases contain a general prohibition on any and …

Obtaining Property Tax Relief in Ohio

The real estate market in Ohio continues to face significant challenges. With many property values declining throughout the state, challenging property tax assessments to obtain tax relief is an important strategy for financial institutions to consider.

How does the complaint process work?
Property taxes in Ohio are paid in "arrears," meaning taxes paid in 2011 are for tax year 2010. By March 31, 2011, a property owner can file a complaint with the Board of Revision in the county in which the property is located to challenge the assessed value of the property for tax year 2010.

The complaint must include certain information including the current assessed value of the property as well as the owner’s opinion of the correct value as of January 1, 2010. The taxpayer will be given a hearing with the Board of Revision, at which the taxpayer can argue for a lower value and at which the local school district may argue to retain the current valuation. An appraisal by a qualified appraiser that supports the taxpayer’s opinion of value is generally suggested for commercial and industrial property.

Value of controlling property taxes
Real property taxes are often a significant non-productive expense of property owners. …