Boston is certainly not the first city to hit the wall of declining commercial property values, and it won’t be the last. The cheering was widespread when everyone worked from home during the pandemic, but now that many of those jobs have disappeared and downtowns are filling up with the homeless, there’s simply not enough commercial tenants left to fill the gap.
A recent report by the Boston Policy Institute found the city may lose $1.4 billion in tax revenue over the next five years due to empty office spaces. Boston could also face a recurring shortfall of about $500 million each year after that first half-decade, the report found.
In a sane world, the solution would be to cut spending and align it with revenue. But in the insane Keynesian universe, the “solution” is to tax the remaining commercial property owners even harder than they already are. I can’t imagine any negative consequences arising from that, can you?
The measure would give the city the flexibility to temporarily shift more of the property tax levy onto commercial and industrial property owners. If approved, new tax rates would only go into effect if commercial valuations come in low as expected, Wu said.