Property taxes continue to be a thorn in the side of Boston Mayor Michelle Wu.
Wu’s main challenger in this fall’s election, Josh Kraft, on Thursday called on her to address allegations brought by business-friendly researchers of over taxation of Boston’s commercial buildings and retaliation against property owners who have sought tax breaks amid falling values of office buildings.
“A group of legal experts alleged that the City of Boston’s Tax Assessment Department has, for the last number of years, been artificially inflating commercial property values — punishing owners simply because they applied for tax abatements,“ Kraft said at an event Thursday. ”While I can’t speak to the accuracy of these allegations, they are serious and credible. And they demand an answer. … If the evidence is wrong, (Mayor Wu) needs to prove it.”
Kraft’s demand is the up-to-date twist in long-simmering tensions over how office buildings are being taxed in Boston after the COVID-era rise of remote work prompted vacancy rates to surge and values to plummet. And it followed an online webinar hosted Thursday by Boston’s Real Estate Bar Association, where retired bankruptcy court judge Frank J. Bailey of the Pioneer New England Legal Foundation and attorney Daniel Swift outlined allegations that the city of Boston has deliberately over-valued 39 Boston buildings by $545 million the last two years, generating an excess $13.3 million in property tax payments by their owners.
Pat Greenhouse/Globe Staff
The Pioneer New England Legal Foundation in June accused the city of deliberately retaliating against property owners who sought tax abatements, on the grounds that their buildings are worth less due to higher vacancy or other factors, but did not publicly identify any affected buildings or property owners.
Thursday’s webinar shared by far the most comprehensive set of information about the alleged tax penalties, and comes after state Revenue Commissioner Geoffrey E. Snyder, whose office oversees abatement appeals, twice told the PNELF his staff was “unable to substantiate” their claims.
At Thursday’s webinar, Bailey presented a spreadsheet of 39 properties the foundation is alleging have been over-taxed by a combined $13.3 million in fiscal year 2024 and 2025. Amid those 39 buildings include prominent downtown office towers at 125 High St., One Federal St., and 60 State St., which the legal foundation alleges have been over-taxed by $2.5 million, $1.6 million, and $1.5 million, respectively.
Tishman Speyer, which owns 125 High St. and One Federal St., declined to comment.
Should the allegations of over taxation and overvaluation prove true, Kraft said, the city would be “forced to refund hundreds of millions in overpaid taxes” and that would be “a massive blow to Boston’s finances.” He also cited a study from the Boston Policy Institute, a research group which does not disclose its financial donors, that estimates the city could face $1.7 billion less in property taxes over a five-year period due to falling office values.
Wu on Thursday did not address the specific allegations of retaliatory over taxation, though her administration has previously said that buildings appealing their assessments will still need to pay the higher rate while the appeal is pending.
Her campaign did issue a statement challenging Kraft’s understanding of property taxes, noting her push to boost commercial tax rates last year was intended to cushion residential property owners from steep increases and returning to a frequent theme in her campaign: Kraft’s family wealth.
“Maybe he’s been slow to understand the issue,” Wu’s campaign said, “because he has never had to worry about how to afford rent or housing costs.”
Catherine Carlock can be reached at catherine.carlock@globe.com. Follow her @bycathcarlock.
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