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Attorney challenges Syracuse valuations for three Walgreens properties, cites weaker leases and recent sublease
Summary
Attorney representing owners of three Walgreens properties asked the Syracuse Board of Assessment Review to cut assessments, saying long-term Walgreens leases no longer reflect market rents and pointing to a recent Dollar General sublease and sales comps.
An attorney representing multiple Walgreens property owners urged the Syracuse City Board of Assessment Review on Feb. 21 to lower the tentative assessed values on three city Walgreens sites, arguing current long-term Walgreens leases overstate present market value.
The petitioners — represented at the hearing by Nicole Forcelli — asked the board to change the assessments on 2329 James Street, 394 Velasco Road (Onondaga Road), and 401 West Seneca Turnpike. Forcelli told the board she submitted comparables showing recent sales of similar drugstore properties and a market-based valuation roughly 40–50% below the city’s tentative market values.
Why it matters: The assessed value sets property tax bills and, where leases are triple-net, affects both owners and tenants. For commercial buildings anchored by national chains, shifts in corporate strategy and market demand can change what investors will pay.
For 2329 James Street, city records cited a tentative full market value of about $3.39 million; Forcelli said comparable sales drive a market value near $2.1 million and, after Syracuse’s equalization rate, an assessed value near $1.3 million. For 394 Velasco Road the city’s market figure was about $2.26 million and the petitioner claimed roughly $678,000 in market value for the city portion, yielding an assessed value the petitioner put near $390,000. For 401 West Seneca Turnpike the city listed a market value of about $3.79 million; the petitioner proposed a market value near $1.14 million (assessed $654,000) based on a recent sublease.
Forcelli told the board many of the contested leases were signed roughly 20 years ago and carry rents far above current market. She said the most recent lease data point for the area is a 2023 deal in which a tenant pays about $145,000 annually, much lower than the older Walgreens lease rates. She also cited news coverage and credit-agency downgrades showing Walgreens is shrinking operations and closing hundreds of stores, arguing that weak corporate performance reduces demand and sale prices for former Walgreens locations.
City staff acknowledged the volume of supporting materials and said they would review the submitted comparables, lease documents and income statements. A city staff member (identified in the record as Matt) said the appraisal approach typically used by the city relies on local sales and an income-capitalization method and that older sales remain relevant when they appear to be arms-length transactions, though he agreed a more recent sale or lease can be persuasive.
On 401 West Seneca Turnpike staff noted Walgreens vacated the location and subleased it to Dollar General in 2023 at that lower rent, a fact Forcelli offered as evidence of a changed market. Board members and city staff said they would examine the submitted lease amendments, any renewals, and the petitioner’s sales comps before issuing final determinations; the board did not take a vote at the hearing.
The board recorded that the City would distribute formal notices by April and that staff would follow up to request any missing lease amendments or clarifying P&L documents the assessor needs to finalize review.
Ending: Board members thanked the petitioner for detailed materials and said the city would reexamine the three Walgreens assessments using the new evidence before issuing final notices in April.
