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Collapse of hotel tax revenue could put more pressure on Alexandria residents

In a glimpse at financial assessments for 2022, Alexandria Mayor Justin Wilson said on Twitter that declining hotel revenue — and thus taxes paid to the city — will put more of the city’s tax burden on residents.

The decline of tax revenue for the City of Alexandria is just one part of a difficult financial recovery from the pandemic — one exacerbated by the omicron surge earlier this winter. While sales and meals tax have rebounded slightly, the dearth of hotel funding has even led the city to consider investing in a new hotel.

“In 2019, there were 31 hotel properties in the City of Alexandria worth a total of $753 million,” Wilson said. “Today, those 31 hotel properties are assessed at a total of $464 million.”

That’s a 38% drop in the value of hotel properties in the city.

Meanwhile, Wilson said average assessments on single-family homes and condos have increased city-wide.

The real property assessments are scheduled to be reviewed at a City Council meeting on Tuesday, Feb. 8. A report prepared for the meeting indicates that the gulf between the commercial and residential tax base could widen this year.

Commercial vs residential tax base distribution, image via City of Alexandria

The report said there’s been a $915.86 million growth in commercial assets in Alexandria, with a 15.36% increase for warehouses and a 10.33% increase for apartments offsetting a 12.5% decline in commercial assets for hotels and 6.47% decline in shopping centers.