MARTINEZ — Real estate values in Contra Costa County are falling as prices for many commercial properties, including office buildings, have plummeted, according to an annual government report.
While property values are rising in Contra Costa County, the rate of increase is the slowest in the past three years, pointing to weakness in sectors such as commercial real estate.
NoMa Apartments is a 135-unit apartment complex located at 1910 North Main Street in Walnut Creek. (Google Maps)
Sluggish property value growth could put a strain on the revenue that Contra Costa County city, regional and county agencies receive from property tax revenue.
The total assessed value of real estate in Contra Costa County was $278.84 billion on the 2024-2025 assessment roll, according to a report released by the county assessor's office.
Contra Costa County real estate values as of January 1, 2024 are up 4.2% from the previous year to $11.16 billion. The current assessed total is the highest real estate value ever recorded in the county.
Still, a review of recent county assessment reports shows some signs of weakness in Contra Costa County.
The 4.2% increase was the lowest annual percentage increase in property values in Contra Costa County since the 2021-2022 assessment period three years ago, when it was applied to property values as of January 2021.
The sluggish real estate values in this part of the East Bay come on the heels of a tough situation for office building prices across the Bay Area.
Contra Costa County has not been spared from the tough commercial real estate trends.
“The office building business has plummeted,” Contra Costa County Assessor Gus Kramer said.
Values of apartments and retail buildings have also been volatile.
Below are some examples of real estate transactions from 2023 that show commercial real estate values will fall.
— Concord Corporate Center in Concord was acquired for $20 million, a staggering 68.5% plunge from the office complex's 2017 value.
— One Concord Center in Concord was purchased in August 2023 for $40.5 million, which represents a 42.6% decline from its 2017 value.
— The NoMa Apartments in downtown Walnut Creek have been relinquished to their residential real estate lender after the apartment developer failed to repay a $79.8 million loan.
The smallest increases in assessed values were in Concord, Walnut Creek and San Ramon, according to the report.
Appraisals increased 1.5% in Walnut Creek, 1.7% in Concord and just under 3% in San Ramon.
Cities with the biggest increases in assessed values included Martinez, Oakley, Antioch and Richmond, according to a report from the county assessor's office.
The cities with the most significant increases in assessed values are as follows:
— Martinez, up 6.1%
— Oakley, up 5.2%
— Antioch, up 5%
— Richmond, up 4.7%
Property tax revenues depend on the assessed value of the parcels involved.
That means a slower pace of value growth could squeeze a large chunk of the tax revenue that flows to government and local agencies in Contra Costa County and its cities.
“This could have an impact on the city and county budgets,” Kramer said, “and have a significant impact on the services the city and county provide.”