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Dr. Oz spent years, millions improving his Palm Beach mansion. Now he’ll get a tax break

Alex Roarty
McClatchy Washington Bureau (TNS)

Two weeks before he would become one of the year’s most famous and polarizing Republican nominees for office, Mehmet Oz was approved for a large tax exemption on a house he owns in a community close to his heart.

The tax break wasn’t for Oz’s newly purchased home in Pennsylvania, the state he is trying to represent in the U.S. Senate. And it wasn’t for any of his properties in New Jersey, which critics argue is Oz’s true home state.

It was for a house in Palm Beach, Florida, a playground for the wealthy that Oz has described as “heaven.”

A multimillion-dollar upgrade to his beachfront mansion in the area — including the installation of a new outdoor pool and spa — led to Palm Beach County commissioners on May 3 signing off on a tax exemption meant to encourage the rehabilitation of old historic homes. The abatement, according to documents reviewed by the Miami Herald, could save Oz a half-million dollars or more over the next 10 years.

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Pennsylvania Republican Senate candidate Mehmet Oz holds his phone to the microphone, sharing a live call from former President Donald Trump with his audience, at a May 16, 2022, town hall in Blue Bell, Pennsylvania. (Tom Gralish/The Philadelphia Inquirer/TNS)

The TV-doctor-turned-politician would go on to win his May 17 primary in Pennsylvania (with the help of an endorsement from Palm Beach neighbor Donald Trump), emerging as the GOP’s standard-bearer in one of the most closely watched races of this year’s midterm elections.

But as Oz fends off attacks that he is an interloper and ongoing criticism that he owns 10 homes, the tax exemption — and the time and money invested in Palm Beach to receive it — are reminders of Oz’s deep and varied ties to Florida, connections that include stakes in local businesses, ownership of at least two properties in the state and a leadership position in an area civic association. In interviews over the years, he has repeatedly cited it as a special place for both him and his family.

“Palm Beach is my ‘chi’ source, a place I come to regroup,” Oz told Palm Beach Life magazine in 2009.

In a statement, an official with Oz’s campaign reiterated that the doctor has longstanding ties to Pennsylvania, and criticized his Democratic opponent, John Fetterman.

“Pennsylvania is where Dr. Oz grew up, met his wife, and started his family,” said Rachel Tripp, senior communications adviser for Oz’s campaign. “He resides in Bryn Athyn, where his wife’s family has lived for over a hundred years and in the same house he married Lisa in. Pennsylvania is also home to some of the worst crime and increase in prices in the entire nation — all as a result of the radical policies under Joe Biden that John Fetterman wants to take even further.”

How much voters ultimately care about Oz’s connections to Florida, particularly in an era of voter hyperpolarization, remains to be seen. Polls show the public is deeply worried about the economy and rising cost of living, anxieties the Republican candidate has sought to tap into in his race against Fetterman.

But critics, including Fetterman, have accused Oz of being a carpetbagger, concentrating on the doctor’s connections to New Jersey, a state he lived in for about 30 years. Oz purchased a home in Pennsylvania in December of last year, in suburban Philadelphia, six years after he bought the mansion in Palm Beach, which he’s been visiting for decades.

A survey released in March found that 74% of voters in Pennsylvania said how much time a candidate has spent in their state was either very or somewhat important.

“I’m very proud that I’m a Pennsylvanian,” Oz told WHTM-TV at the time. “They care much more for what I stand for than where I’m from.”

A Fox News survey in late July found Oz trailing Fetterman by 11 percentage points, 36% to 47%.

Dr. Oz’s Louwana

Owning a second home in Florida is not unusual, as the legion of snowbirds who populate the state in winter months can attest. But the breadth of Oz’s associations with the Sunshine State — and the praise he’s ushered on Palm Beach in particular — go beyond the occasional vacation.

A 2018 story in Boca Raton Magazine referred to Oz as a “part-time Palm Beach resident,” interviewing him about what he enjoys while in the area and asking him his favorite local restaurants. Palm Beach Illustrated in 2019 named him one of Palm Beach County’s “top physicians,” publishing an interview with the doctor in which he said he and his family hoped to spend more time in the area.

How much time Oz has actually spent in Florida is unclear. In interviews, he said he and his wife, who has family in the area, have been visiting Palm Beach for decades.

More recently, he told Boca Raton magazine that he and his family visited for Christmas or spring break. An official with Oz’s campaign said he has never considered Florida, or Palm Beach, his primary residence. The official added that the doctor hadn’t been to his South Florida house in “several months” and uses it primarily as an investment property to rent out.

But Oz has nonetheless invested serious time and money into his beachfront mansion, known as Louwana.

He and his wife, Lisa, purchased the Palm Beach home through a trust for $18 million in 2015, documents show. The landmarked house, built in 1919 and designed by famed South Florida architect Addison Mizner, abuts the beach and is billed as one of the “last great houses of Palm Beach,” according to a listing from Sotheby’s International Realty.

It now has 10 bedrooms and 15 full bathrooms while the whole property is listed at more than 18,500 square feet, according to the Palm Beach County Property Appraiser.

“Louwana historically reflects the expansive economy of the very wealthy and their tropical playground of Palm Beach,” read a historic preservation property tax exemption pre-construction application, submitted by Oz’s trustee to the town of Palm Beach in 2017.

Documents reviewed by the Herald showed the renovation, which lasted from March 2018 to September 2020, would eventually include a new kitchen, game room, gym, guesthouse and garage — part of an overhaul that people familiar with the home said was necessary to fix its dilapidated state. The home was last renovated in 1980, according to documents.

“The house is beautiful ... But the kitchen is not up to date,” Oz told Boca Raton Magazine in an April 2018 interview. “It’s sort of cramped. So the renovations are going to allow us to redo the kitchen ... so we can actually eat in there.”

The rehabilitation work also included the construction of a new outdoor spa — at a cost of $13,800, per a construction permit application filed in November 2019 — just feet from a newly refurbished pool, which had been built into the structure of the old pool. The work on the new pool was valued at $51,000, according to documents filed with the Town of Palm Beach Building Division in October 2019.

In September 2020, an application was filed to include “landscape modifications” as part of the tax abatement — a month later, a separate application to the Town of Palm Beach specified the improvement was part of a “landscape lighting plan.”

Eventually, Oz’s trust would list each project on tax exemption applications filed with the Town of Palm Beach. The abatement program is a potentially lucrative one for those eligible: It allows homeowners who complete rehabilitation work on specially designated historic homes to exempt the value added from municipal and county taxes. The program lasts 10 years and passes on to new homeowners if the building is sold.

In a document filed to the Town of Palm Beach in September of last year, the trust estimated the total cost of the rehabilitation at about $3.4 million.

An appraiser from the county later determined, in documents made public last week, that the construction had added just over $9 million of value to the home, money now exempted from property taxes paid to the town and county. The exemption meant that, instead of paying county and municipal property taxes on a home valued at $25 million, the trust would have to pay taxes on a $16 million valuation.

Because of the exemption’s 10-year time frame, determining exactly how much money Oz will save is unclear — even millage rates for this year still haven’t been decided. But the exemption could save the doctor nearly $61,000 in taxes annually, at current tax rates, according to calculations by the Herald. Over a decade, that would amount to savings of $610,000.

An official with Oz’s campaign said the tax abatement “was simply an adjustment to his taxes made by his attorney to reflect what was being done to the house since it needed a significant amount of work done to it.”

Palm Beach Civic Association

It’s not the first time Oz has received a tax break tied to a new home. He received a $50,000 tax break after buying his home in Montgomery County, Pennsylvania, the Philadelphia Inquirer reported, because of a program encouraging the preservation of trees or forestland.

The tax abatement he received at Louwana is meant to encourage homeowners to rehabilitate and upgrade their homes, according to local experts.

“We want them to rehabilitate it,” said Emily Stillings, a historic preservation consultant for Palm Beach. “We want them to encourage the preservation of these historic homes. And basically the overall idea of the program was some sort of financial incentive for people to do that.”

Louwana, which Oz and his wife purchased for $18 million seven years ago, is now estimated as having a value of $52 million, according to real estate website Zillow.

In February of this year, the home was listed for rent for $275,000 a month, according to realtor.com. The listing was removed last month. Oz listed the house on his financial disclosure forms in April as a rental property, with annual income listed as between $1 million and $5 million.

Louwana is not the only land the Republican candidate owns in Florida. In December of last year, the same month he purchased his home in Bryn Athyn, Pennsylvania, Oz — through a trust — purchased three parcels of farmland in Okeechobee County, according to the county’s property appraiser. The land was purchased for nearly $6.5 million.

Oz listed the farmland on his financial disclosure statements filed with the Senate in April, saying it was worth between $1 million and $5 million.

Oz, according to financial disclosure statements filed in April, also owns stakes in four hotels in Florida, worth up to $800,000 combined.

Beyond owning property, Oz also spent time working with on-the-ground organizations in Florida, especially the Palm Beach Civic Association.

Oz became a director of the Palm Beach Civic Association in March 2017, according to Senate disclosure forms, and remained one until at least April of this year. He is no longer listed as a director on the association’s website.

What a director of the Palm Beach Civic Association does is unclear. On its website, the group lists more than 125 directors. Some of them, like Oz, are famous, including “Inside Edition” anchor Deborah Norville and novelist James Patterson.

The doctor was not a passive participant with the group, hosting an award luncheon in 2019 and recording a video for the group in 2020, when the coronavirus pandemic was beginning to grip the country.

A spokeswoman for the association declined to comment. An official with Oz’s campaign said he had “more of a role in that association a while ago, but no longer has an active role.”

Regardless of his role now, Oz has regularly praised the area.

“You guys are living in heaven,” Oz told an audience in 2013, during an interview with a local TV station at Palm Beach Gardens, a community just west of Palm Beach. “You may not realize you’re in heaven, but you’re absolutely in heaven. Just an incredible part of the country.”