Commercial Real Estate – Accelerated Depreciation

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What property types benefit most from accelerated depreciation with a Cost Segregation Study?

Many of the costs embedded in a new or existing building can be segregated into categories that also allow for more rapid — or accelerated — depreciation. Many items inside the building – furnishings, fixtures, flooring and the like – can be depreciated more quickly, over 5 to 7 years; and the site improvement components can be depreciated over a 15-year period.

Best suited for:

  • Real estate construction valued at over $1 million
  • Building acquisitions or improvements
  • New buildings under construction
  • Existing buildings undergoing renovations or expansions

Best savings potential:

  • Office buildings
  • Shopping centers
  • Restaurants
  • Hotels
  • Warehouses and distribution centers
  • Manufacturing and industrial plants
  • Medical facilities

Learn more about accelerated depreciation and Cost Segregation Studies – the IRS has detailed information on cost segregation techniques. The CSS can be done independently or conducted in parallel with a Property Condition Report or an Environmental Site Assessment.

For investors considering whether to purchase a commercial property and for real estate brokers trying to make a marginal transaction feasible, a Cost Segregation Analysis may be essential and Criterium Engineers is uniquely qualified perform it.