Downtown Spokane Takes A Hit As Property Values Keep Sliding

Downtown Spokane just took another hit on paper, and this one is coming straight from the county assessor.

New valuation notices that went out this month show office buildings and apartment complexes in the city’s core slipping in value again, even as manufactured homes and undeveloped land move in the opposite direction. Spokane County’s Assessor’s Office mailed out 2027 tax year assessments on June 1 to more than 214,000 parcels, using market conditions as of Jan. 1.

Countywide, the average assessed value for a single-family home now sits at about $441,703. Single residential units saw only a 0.83% bump this cycle, a far cry from the pandemic-era surge when typical assessments jumped roughly $100,000 between 2021 and 2022, according to The Spokesman-Review.

How The Values Are Calculated These notices are not tax bills. They are meant to be a Jan. 1 snapshot of the market, built from recent local sales, exterior inspections and neighborhood-level adjustments.

As Spokane Public Radio explains, county appraisers lean on sales data whenever possible, then drive by properties to confirm exterior conditions, and use statistical models to fill in the gaps. Property owners who think the county overshot have an appeal process, but any big swings in buyer behavior after Jan. 1 will not show up until next year’s round of notices.

Downtown Office Weakness Is Driving The Slide The soft spot is clear. Office properties across Spokane County dropped about 1.3%, but the downtown core was hit harder, with values there falling more than 4%. Apartment complexes in the core slid even more, dropping by more than 5%, according to county figures reported by The Spokesman-Review.

The trend extends a multiyear backslide for big downtown office towers and highlights how tough it has been to refill those buildings in the remote work era.

Assessor Tom Konis said the market has “calmed” after the pandemic spike and that remote work is reshaping demand for downtown office space. In an interview he called the COVID-era run-up “an ugly market” and said some property types, including medical offices and vacant land, have actually gained value, according to Spokane Public Radio.

What This Means For Taxes And Downtown Recovery

When prime downtown properties lose value, the tax base that funds local services can shrink and the burden can shift toward other kinds of property. Spokane officials are paying close attention to that dynamic, in part because they have seen what is happening on the west side of the state.

In King County, the assessor’s data showed that Seattle’s biggest office towers collectively lost about $3.7 billion in value as vacancies climbed, according to KIRO7. Spokane is now watching its own revenue picture as downtown values slide.

At the same time, state-level changes that broaden tax exemptions for seniors and people with disabilities are set to kick in for the 2027 tax year. The assessor’s office and Spokane County plan to share guidance with residents who might newly qualify.

On the ground, local agents say the numbers mostly match what they are seeing. Karene Garlich-Loman, immediate past president of the Spokane Realtors Association, told The Spokesman-Review she has “noticed a small dip” in downtown commercial values and suggested it may take policy shifts and better street-level conditions to restore investor confidence.

This latest turn in Spokane’s real estate story was first flagged in an item on Seattle Red as the county rolled out its notices, and local outlets quickly picked up the thread as assessment letters hit mailboxes across the region.

Downtown Spokane Takes A Hit As Property Values Keep Sliding

Comments / 20