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File #: 25-2740    Name: 2025 Assessment Report
Type: Written Report Status: Agenda Ready
File created: 12/19/2024 In control: City Council Legislative Meeting
On agenda: 2/11/2025 Final action:
Title: Consideration of the Calendar Year 2025 Real Property Assessments.
Attachments: 1. 25-2740_Att 1 CY 2025 Real Property Assessment Land Book, 2. 25-2740_Att 2 CY 2025 Equalized Assessment Summary, 3. 25-2740_Att 3 Historical New Growth (CY 2018 to CY 2025), 4. 25-2740_Att 4 Potomac Yard, 5. 25-2740_Att 5 Real Estate Tax Base Distribution (CY 2009 to CY 2025), 6. 25-2740_Att 6 Distribution of 2025 Assessments by Land Use, 7. 25-2740_Att 7 Points of Interest - CY 2025 Residential Assessment Changes, 8. 25-2740_Att 8 Average 2025 Real Property Assessment Percentage Change Map, 9. 25-2740_Att 9 Analysis of the Commercial Market, 10. 25-2740_Att 10 Overview of the Assessment Process, 11. 25-2740_Att 11 2024 New Construction Projects, 12. 25-2740_Att 12 Noteworthy Trends in Alexandria Real Estate, 13. 25-2740_Att 13 2025 Staff Presentation

City of Alexandria, Virginia

________________

 

MEMORANDUM

 

 

 

DATE:                     FEBRUARY 5, 2025

 

TO:                                          THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL

 

THROUGH:                     JAMES F. PARAJON, CITY MANAGER /s/

 

FROM:                     KENDEL TAYLOR, DIRECTOR OF FINANCE

  

DOCKET TITLE:                     

TITLE

Consideration of the Calendar Year 2025 Real Property Assessments.

BODY

_________________________________________________________________

 

ISSUE: (1) 2025 Notices of Assessment, which include the previous two calendar years and percentage change in the tax levy when applicable and practicable, will be mailed to property owners on February 12; and (2) staff will present the new real estate values at the February 11 City Council legislative meeting.

                     

RECOMMENDATION:  That City Council receives the report.

 

BACKGROUND: Included in the attached report are the annual changes in real property assessments from CY 2024 to CY 2025 and historical statistics related to assessment appreciation/depreciation, new construction, and residential sales activities.

 

The CY 2025 real property tax rate applicable to the January 1 assessments is scheduled to be set by the City Council on April 30, 2025. 

 

DISCUSSION:

 

OVERALL CHANGE IN CY 2025 REAL PROPERTY TAX BASE

 

The City’s overall assessed real property tax base increased 2.57%, or $1.25 billion on a year-over-year basis, from $48.5 billion in CY 2024 to $49.7 in CY 2025 (Attachment 1, Page 2, Line 73). The overall increase exhibits continued improvement in the residential market.

 

 

The following table shows the year-over-year Land Book changes in grand total taxable real property assessments from CY 2019 to CY 2025. Of the $363,875,942 in taxable new growth reported as of January 1, 2025, $188,360,427 (51.77%) is attributable to new multifamily rental projects and $167,190,566 (45.95%) is attributable to residential projects, mostly from renovations and additions. This development accounted for 98% of the City’s new growth in CY 2025 and will be shown in greater detail in Attachments 3 and 12.

 

                     Calendar Year                     Grand Total Taxable Real                                          Change from Prior Year

 

                          2019                                   $40.98                                                                                     2.71%

                          2020                                   $42.68                                                                                                         4.15%

                          2021                                   $43.83                                                                                                         2.69%

                          2022                                                               $46.56                                                                                                         6.24%

                          2023                                                               $48.33                                                                                                         3.81%

     2024                                                               $48.49                                                                                                         0.33%                     

                          2025                                                               $49.74                                                                                                         2.57%

 

Attachment 2 reflects the tax base from the starting point of the 2024 equalized assessments. The equalized assessment represents the year-ending 2024 total (as of December 31, 2024) that reflects changes that occurred throughout the calendar year including administrative reviews, appeals, Board of Equalization changes, supplemental assessments, subdivisions, consolidations, changes in tax status and demolitions.  On this basis, locally and non-locally assessed real property assessments increased 2.41% (Attachment 2, Page 3, Line 66).

 

Points of Interest Relating to the CY 2025 Land Book and Equalized Assessment Changes:

 

  • Locally assessed real property assessments increased 2.54% (which consists of both new construction and appreciation), or $1.2 billion, from $47.8 billion in 2024 to $49.0 billion in 2025 (Attachment 1, Page 1, Line 49). 
  •  
  • The residential property tax base increased 4.55%, or $1.4 billion, from $30.1 billion in 2024 to $31.5 billion in 2025 (Attachment 1, Page 1, Line 21).
  •  
  • The average assessed value for all residential property (including single-family and condominium) as of January 1, 2025, increased 4.45%, from $698,794 in CY 2024 to $729,925 in CY 2025. For 2025, approximately 83% increased, 1% decreased, and 16% remained unchanged.

 

The average assessed value for a residential single-family home as of January 1, 2025, increased 4.06%, from $962,275 in CY 2024 to $1,001,336 in CY 2025. For 2025, approximately 64% increased in value, 2% decreased, and 34% remained unchanged.

 

The average assessed value for a residential condominium as of January 1, 2025, increased 5.63%, from $423,765 in CY 2024 to $447,612 in CY 2025. For 2025, approximately 73% increased in value, 2% decreased, and 25% remained unchanged.

 

Ø                     The commercial property tax base decreased by 0.88%, or $156.4 million, from $17.69 billion in 2024 to $17.54 billion in 2025 (Attachment 1, Page 1, Line 47). This compares to a 4.00% decrease the previous year. The hospitality properties led the commercial market, increasing 20.05%. Multi-family properties decreased overall by 1.11%. The office sector continued to decrease, losing a further 10.28% of value from 2024.

 

Ø                     State-assessed public service corporation property assessments increased 4.86%, or $34.1 million, from $701.1 million in 2024 to $735.2 million in 2025 (Attachment 1, Page 2, Line 71).  The 2025 state-assessed Public Service Corporation assessments are effective January 1, 2024. These values are certified by the State Corporation Commission (SCC) and the Virginia Department of Taxation (VDoT) in late September of the effective year of the valuation.  The City bills all non-locally assessed properties on a fiscal year basis to accurately reflect these assessment changes.

 

  • Tax exempt real property assessments increased 3.48%, or $201.2 million, from $5.8 billion in 2024 to $6.0 billion in 2025 (Attachment 1, Page 2, Line 107).  Most of this increase is attributable to local public schools and the Virginia Tech Innovation Center.
  •  
  • Taxable new construction activity added $363.9 million for CY 2025. This compares to CY 2024 when $522.1 million of growth was added to the City’s tax base. Residential construction accounted for $167.2 million of the new growth, while the commercial sector, which includes multifamily rental, accounted for $196.7 million. The multi-family residential sector alone had $188.4 million in new growth. Overall, $2.5 billion in new growth has been added to the tax base from 2021-2025. Historical new growth figures are detailed in Attachment 3.
  •  
  • The table below compares the City of Alexandria’s median assessment to sales ratio for tax year CY 2023 to the Northern Virginia jurisdictions listed below, as determined by the Virginia Department of Taxation (VDoT). Alexandria’s ratio was in line with the surrounding Northern Virginia localities, showing the City’s assessments were close to market value. Median ratio data for CY 2024 will be released in early 2025.
  •  
  •                                                                Jurisdiction                                                               Median Ratio
  •                                                                
  •                                                                Arlington County                                          93.57%
  •                                                                Alexandria                                                               93.26%
  •                                                                City of Fairfax                                                               91.19%
  •                                                                Fairfax County                                          90.31%
  •                                                                Falls Church                                                               89.33%
  •  
  • Impact of Tax Relief
  • Eligibility for real estate tax relief for the elderly and disabled also includes military veterans who are considered completely and permanently disabled and spouses of those determined to be killed in action. The City has budgeted approximately $9.1 million for these programs in FY 2025 and anticipates increasing this to approximately $10 million in FY 2026.
  •  
  • Distribution of Real Property Assessments
  •  
  • Real property classified as residential for assessment purposes for CY 2025 represents 63.3% of the total real property taxable base, while properties classified as commercial and public service corporations represent 36.7% of the base. If multifamily housing is excluded, commercial assessments are 17.5% of the base.  This compares to CY 2024 when 62.1% of the tax base was residential, and property classified as commercial and public service corporations represented 37.9% of the base. If multifamily housing is excluded, commercial real property comprised 18.0% of the CY 2024 tax base. A historical distribution of the City’s real property tax base allocated between classifications of real property for assessment purposes is detailed in Attachment 5.
  •  
  • Attachment 6 depicts the distribution of the CY 2025 assessments using actual dollars and percentages by land use. The land uses represented are residential single-family; residential condominium; residential vacant land; commercial multifamily rental; commercial office, retail, and service; commercial and industrial vacant land; and public service corporations.

 

 

ATTACHMENTS:

 

Attachment 1:                                          CY 2025 Real Property Assessment Land Book

Attachment 2:                     CY 2025 Real Property Assessment Summary Including Appreciation and Growth

Attachment 3:                     Historical New Growth (CY 2018 to CY 2025)

Attachment 4:                     Potomac Yard

Attachment 5:                                          Real Estate Tax Base Distribution (CY 2009 to CY 2025)

Attachment 6:                                          Distribution of 2025 Assessments by Land Use

Attachment 7:                     Points of Interest - CY 2025 Residential Assessment Changes

Attachment 8:                     Average 2025 Real Property Assessment Percentage Change Map

Attachment 9:                     Analysis of the Commercial Market

Attachment 10:                     Overview of the Assessment Process

Attachment 11:                     New Construction Projects

Attachment 12:                     Noteworthy Trends in Alexandria Real Estate

Attachment 13:                      PowerPoint Presentation

 

 

 

 

STAFF:

Kendel Taylor, Director of Finance

Division of Real Estate Assessments

William Bryan Page, Assistant Director of Finance / Real Estate

Annwyn Milnes, Appraiser Supervisor

Stephanie Branizor, Appraiser Supervisor

Leona Bradford, Senior Appraiser

Madison Blume, Senior Appraiser

Aracelie Hernandez, Senior Appraiser

Jessica Wills-Lipscomb, Appraiser

Eric Braun, Appraiser

Greylind James, Appraiser

Gregory Richardson, Appraiser

Jasenka Reeves, Real Estate Land Records Manager

George Gray, Management Analyst II

Jonah Mitchell, Administrative Analyst