Retail Shopping Center Cost Segregation Case Study | $580,000 in Year One

Study Summary

A $2,000,000 retail shopping center placed in service in July 2026, studied for the 2026 tax year.

Without a study, the owner would depreciate the full cost basis as 39 year property. Our engineers identified 29% of it as 5 and 15 year property. With 100% bonus depreciation, that $580,000 was deducted in the first year, and at a 37% tax rate it added $214,600 to the owner’s cash flow in year one.

Property type: Retail shopping center
Cost basis: $2,000,000
Placed in service: July 2026
Tax rate: 37%
Bonus depreciation: 100%

$580,000
Accelerated depreciation, deducted in year one
$214,600
Additional cash flow in year one at a 37% tax rate
$51,282
Year-one deduction without a study, straight-line over 39 years
$616,410
Year-one deduction with the study, more than 12 times as much

Where the $2,000,000 Went

5 year property
Tenant fixtures, display systems, specialty lighting and interior finishes
$420,00021%
15 year property
Parking, curbs, sidewalks, landscaping, signage and site lighting
$160,0008%
39 year property
The shell, roof and framing, left on the standard schedule
$1,420,00071%

Year-one figures are simplified: straight-line divides the basis evenly over 39 years and leaves out the mid-month convention. Results depend on your property.

Cost Segregation Results by Property Type

Accelerated depreciation is the part of the price our engineers moved onto 5, 7 and 15 year schedules. Select a study to see its full numbers.