Forecast of 2009 Shrinking Tax Rolls

National Real Estate Investor reported “…The faltering economy, credit crunch and the net loss of 1.2 million jobs this year will weigh on consumers to make this holiday shopping season one of the weakest many retailers can remember, Duffy predicts. “Looking ahead to 2009, it’s highly unlikely conditions will stage any type of recovery until the second half of the year at the earliest.” Here in Texas the Dallas Business Journal Recently published an article titled “Overexposed? D-FW banks’ infatuation with commercial real estate loans could lead to problems.”  The article quoted an investor Tom C. Davis, who stated, “If I am right, we’ll have a dismal Christmas retail season, and in the first quarter with retailers under pressure, you’ll see more bankruptcies,” he said. “The credit tenants that used to be in strip centers are no longer to be there.” As noted below we see the national retailers are suffering from the economic storm we find ourselves in:

  • Circuit City (filed Chapter 11)Â
    Ann Taylor- 117 stores nationwide closing
    Lane Bryant, Fashion Bug ,and Catherine’s to close 150 stores nationwide
    Eddie Bauer to close stores 27 stores and more after January
    Cache will close all stores
    Talbots closing down specialty stores
    J. Jill closing all stores! (owned by Talbots)
    Pacific Sunwear (also owned by Talbots)
    GAP closing 85 stores
    Footlocker closing 140 stores mo re to close after January
    Wickes Furniture closing down
    Levitz closing down remaining stores
    Bombay closing remaining stores
    Zales closing down 82 stores and 105 after January
    Whitehall closing all stores
    Piercing Pagoda closing all stores
    Disney closing 98 stores and will close more after January.
    Home Depot closing 15 stores 1 in NJ ( New Brunswick )
    Macys to close 9 stores after January
    Linens and Things closing all stores 
  • Movie Galley Closing all stores
    Pep Boys Closing 33 stores
    Sprint/Nextel closing 133 stores
    JC Penney closing a number of stores after January
    Ethan Allen closing down 12 stores.
    Wilson Leather closing down all storesÂ
    Sharper Image closing down all storesÂ
    K B Toys closing 356 stores
    Loews to close down some stores
    Dillard’s to close some stores

How does all this negative retail news effect Texas tax rolls?  It seems to indicate that 2009 commercial real estate apprised values will trend downward, which will intern cause property tax rolls to shrink. When tax roll shrink tax rates go up.  Time will tell.