Orchards Mall owner Michael Kohan has successfully reduced his tax bill rather substantially, and while that is good news for him, it will cause some pain for other taxing units in the region as a state tax tribunal has lowered the value of the mall property by more than a third, based on Kohan's appeal for a reappraisal. Other units will have to refund tax distributions already made.
The value of the Orchards Mall has dropped as a result of the state's reappraisal action. The mall had been valued at $4,403,400 until the tribunal's action which reduced the value by fully 35-percent to a new valuation of $2,875,000.00 going forward.
That means that Berrien County Treasurer Bret Witkowski will now have to bill other taxing units for being overpaid based on the previous valuation. The Benton Harbor Area Schools will get a new tax bill from the county for $30,568 and Benton Charter Township will have to refund $20,510.52 according to Witkowski. Other taxing units facing an additional bill for a refund include Berrien RESA, Lake Michigan College and the Michigan State Education Fund.
Witkowski tells me that despite the new appraisal and the reduced tax liability for Kohan and his development company, taxes remain unpaid for both 2014 and 2015. Witkowski will have to recalculate his tax formula and update his computer program as he continues to work to collect the taxes already owed on the mall.
The Orchards Mall was built 37 years ago in 1979, and Kohan's Retail Investment Group out of Great Neck, New York purchased it two years ago.
Kohan purchased the mall in December of 2014 from Sequoia Investments of Eureka, California for an undisclosed price. At the time of his purchase, the Benton Township property marked the 14th center in his investment portfolio. The 60-acre mall site in Benton Charter Township still maintains two major anchors in the form of J.C. Penney and Carson's.
