New construction helps fuel property value bump in Palm Beach County

Fueled by new construction, taxable property values for 2017 are up an estimated 7.1 percent from 2016 in Palm Beach County, according to figures released by the Property Appraiser’s Office.

“It’s a good number because it indicates a reasonable increase in value,” Palm Beach County Property Appraiser Dorothy Jacks said Tuesday. “Now, we’re getting back on cruise control. That’s a good place to be.”

UPDATE: Property appraiser’s office refines property value estimates

The increase is a little higher than the estimates county officials used in putting together a draft of the 2018 budget, which will be discussed during an evening workshop on June 13.

Jacks’ office will give officials for the county and its 39 cities preliminary figures for their taxable property values on July 1, and those are the numbers they will use in discussions to set their 2017-18 budgets and tax rates.

The 7.1 percent growth rate in property values includes new construction added during 2016. Without the new construction, the value of property that existed at the beginning of 2016 grew by 5.5 percent.

Several cities are seeing a much more robust boost than the county overall, and much of that is based on new construction.

Property values are up 9.3 percent in Delray Beach, 10.2 percent in Greenacres and 15.08 percent in North Palm Beach. Loxahatchee Groves, at 15.1 percent, and Palm Springs, at 22.3 percent, saw the biggest percentage increase in the county, estimates show.

While those cities saw big percentage increases, Boca Raton — already the county’s most valuable city with $21 billion in taxable value in 2016, had the biggest jump in new construction, with an estimated net increase of $405 million by 2017. Palm Beach Gardens was second in new construction, with a new increase of $247.7 million.

With new construction worth $166.3 million, Delray Beach’s percentage increase of 9.3 percent is the largest among the county’s large cities.

Along with the population estimates released last week, the numbers from Boca Raton and Delray Beach are another indication of the economic vitality of the southern part of the county. Property values in Boynton Beach also were up 7.4 percent.

“I’m happy to see our values continue to increase,” Delray Beach Mayor Cary Glickstein said. “This increase, which exceeds that of any other large city in the county, shows we are on the right track in terms of what we offer as a place to live and do business.”

In putting together the county’s preliminary budget, officials estimated that property values would rise by 6 percent. An additional 1 percent in property value equates to about $7.5 million in additional revenue, county budget director John Wilson said.

Given that the county’s overall budget exceeds $4.3 billion, that $7.5 million isn’t causing any cartwheels.

“It’s not likely it means we have a windfall,” Wilson said. “We had lots of funding requests that exceeded revenue.”

Palm Beach, where President Donald Trump and other wealthy residents have homes, has the second-highest estimated value in 2017, $16.9 billion. West Palm Beach was next at $11.9 billion, followed by Palm Beach Gardens ($10.9 billion), Jupiter ($10.3 billion) and Delray Beach ($9.5 billion).

Property values in the county’s newest city, Westlake, were part of the equation for the first time this year. The total property value was estimated to be just under $27 million. That number is expected to skyrocket in the years ahead.

Minto Communities recently announced that it has broken ground on a sales center off Seminole Pratt Whitney Road in Westlake. The developer plans to build 4,500 homes and develop 2.2 million square feet of nonresidential space in the city.

New construction accounted for about a third of the growth in taxable value in Palm Beach Gardens, which is expected to see more increases as new homes and commercial space eventually come online in Alton and Avenir.

Elected officials, noting the possible expansion of the state’s homestead exemption in late 2018 and the consequent loss of future revenue to local governments, said it’s too soon to tell whether they’ll be able to give residents a break on taxes. All of Palm Beach Gardens’ departments will submit their requests for money in the budget in the next few weeks, and they’ll have a better idea at the end of June, Vice Mayor Mark Marciano said.

“It’s good to see that our city has performed well, and we’ll have some good growth,” Marciano said. “Just because you have more money, it doesn’t mean you don’t have more expenses, either, so we have to look at both sides of the equation.”

Marciano and Councilwoman Rachelle Litt said they aren’t ruling out a tax reduction, but they need to have a better idea of the city’s projected expenses. The proposed $25,000 increase in the homestead exemption, which will be put to Florida voters in November 2018, is on the agenda for discussion by the Palm Beach Gardens City Council at 7 p.m. Thursday.

“The homestead exemption is going to play a factor to make sure we can maintain the level of service our city has set and residents expect,” Litt said.

Staff writers Lulu Ramadan and Sarah Peters contributed to this story.

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