The valuation of commercial properties in Polk County rose an average of 11.7% this year, an increase that is less than what occurred during revaluations in 2023.

Commercial property in Dallas County saw an average increase in valuation of 3.5%.

In 2023, the average increase in commercial property valuations in Polk County was 19.5%; the valuation of commercial properties in Dallas County rose an average of 15.5%, officials said.

In Iowa, the valuations of all properties are reviewed every odd-numbered year. Property reassessment notices recently began arriving in property owners’ mailboxes. The new valuations are used to determine the property tax bill for payments due in September 2026 and March 2027.

Property valuations are part of the formula used to determine owners’ property tax bills. In Iowa, the first $150,000 of assessed valuation for a commercial or industrial property is taxed at the same rate as residential property. Ninety percent of the remaining value is taxable. Increases in commercial valuations generally mean property owners will likely see larger property tax bills.

“We see a lot of companies doing multistate searches, and they are just looking for a reason to rule you out,” said Adam Kaduce, president of R&R Real Estate Advisors, a division of West Des Moines-based R&R Realty Group. “We are always really cognizant of trying to be competitive. [Property taxes] can’t be negotiated or squeezed down. If property taxes are higher in [Central Iowa] than the 10 other places a company is looking at, we may lose that potential client.”

In Polk County, the average valuation percentage increase for commercial property ranged from 7.75% in Johnston to 16.6% in Grimes, data from the Polk County assessor shows. Some commercial property types saw valuations increase an average of 14% or more. However, the valuations of large office buildings – those with 20,000 or more square feet of space – did not change from 2023 to 2025, said Bryon Tack, chief deputy for the Polk County Assessor’s Office.

“The vacancy rates are still high on those properties,” Tack said. “We didn’t have very many sales to go by [and] we’re starting to see some downward pressure on rents. We just didn’t think we had the evidence like we did for all the other property types to” change valuations.

In the first quarter of 2025, the vacancy rate for the central business district was 27.5%, the highest in the metro area, according to CBRE’s Des Moines office market report. In the first quarter of 2024, the downtown area’s office vacancy rate was just over 14%.

Overall, first-quarter office vacancy rates in the metro area increased to 15.8%, up from 13.7% in 2024, CBRE’s reports show.

Two years ago, data looked at by the assessor’s office indicated the “downtown office market was suffering more than the rest of the market in Polk County,” Tack said. “Since 2023, we’ve seen that spread across the entire county. Large office buildings, regardless of where they’re located, don’t seem to be doing as well as the smaller office buildings.”

Office properties with 10,000 square feet or less saw valuations increase between 10% and 14%, Tack said.

“There’s a lot of competition for smaller spaces,” Tack said. Buying small office properties “is cheaper than building. With rents still relatively high for smaller spaces, purchasing is an option.”

Chris Costa, president and CEO of Knapp Properties Inc., said it wouldn’t be surprising to see some property owners ask assessors to review reassessments if vacancies in their properties are higher than they were two years ago.

“Those owners are going to say, ‘My occupancy is 20% lower than it was two years ago. [Keeping the valuation] the same doesn’t make sense to us,’” Costa said. “That would be an argument us or our competitors would make.”

Typically, property owners don’t look forward to getting biennial revaluation notices, Costa said. Owners of retail properties, which are part of the commercial sector, usually pass on increases in property taxes to their tenants, who in turn pass the increased cost on to customers.

“If the tax component gets too high, your tenants can’t afford to stay in the space,” Costa said. “In the future, you’re not going to get the same rents, and rents are what support [the property’s] value.”

In 2023, Ryan Wiederstein, broker and owner of WB Realty Co., acquired a vacant office building at 7001 Westown Parkway in West Des Moines at a steeply discounted price. The office building had been vacated by Wells Fargo and was sitting empty. The property’s assessed valuation in 2023 was just over $73.2 million. In 2024 it was $19.4 million, and in 2025 it was $18.9 million.
Wiederstein said he is able to lease space in the Atlas Building at rates that are lower than competitors.

“It’s really more beneficial to tenants when they come in in those early years when their taxes and other costs are lower,” he said. “When the building starts getting occupied, the valuation will naturally go up. … But now, when I’m competing against a building with one vacant space and it’s assessed at two to three times the cost per square foot that my building is, it allows me to compete. The operating expenses [competitors] are passing on to tenants are higher than what we are passing on.”

Want to file a protest?
Protests over property tax valuations can be filed through April 30. For information on how to file a protest in Polk County, click here. For information on how to file a protest in Dallas County, click here.

2025 Polk, Dallas county commercial revaluations

The valuation of commercial properties in Polk County rose an average of 11.7% during this year’s revaluation; in Dallas County, values rose an average of 3.5%, officials from the counties said. In Waukee, commercial properties saw an average increase in value of 22.48%, the highest percentage jump among the two counties. To find out more, check out the Business Record’s interactive map and database that includes information about 2025’s total commercial revaluations by city and the average increase from 2024 values. (Revaluations occurred in 2023 and were put in place in 2024.)

To view the interactive map, click here.

To view the spreadsheet, click here.

More online: To learn about revaluation of multifamily properties in Polk and Dallas counties, click here.