The income approach: how commercial assessments get argued down

Published 2026-11-09 · FairAppealPacket

A home is valued by what similar homes sold for. A commercial building is valued by what it earns: market rent, minus vacancy and expenses, divided by a capitalisation rate. Every one of those inputs is an assumption — and assumptions can be contested with better evidence.

The worksheet

Start with the rent roll: actual contracted rents, not the county's market guess. Subtract real vacancy and collection loss to reach effective gross income. Subtract operating expenses to reach net operating income. Divide NOI by a cap rate you can support — with broker evidence or your own comparable set — and you have an indicated value. One published worked example: NOI of $213,000 at an 8% cap indicates $2,662,500 against a county assessment of $4,000,000.

The evidence list

Cook County's Board of Review publishes its commercial evidence list: rent roll, lease agreements, three years of IRS Schedule E, photos, and a vacancy affidavit. New Jersey requires an income statement for commercial and rental property of 4+ units. The pattern is universal — the boards want the property's own books, not an argument.

Why this is a product, not a printout

No database holds your rent roll. That is why the commercial packet starts with a guided intake and ends with the worksheet above, and why the human alternative — contingency consultants at 8–50% of savings — costs what it costs. Our commercial packet is flat by assessed value, and the owner keeps every year of the saving.

General information from public sources, not legal or appraisal advice. Software, not representation. FairAppealPacket is not a law firm, a licensed appraiser, or a licensed property-tax consultant. We do not file, appear, or negotiate for you. You review, sign, and file your own appeal. No result is guaranteed.