Key Takeaways: Depreciation in Commercial Real Estate Investment Strategies Depreciation allows investors to spread the cost of a property over its useful life. For example, a commercial building might be depreciated over 39 years. This means a portion of the building’s cost can be deducted from taxable income each year. While the property itself isn’t losing cash value each year, depreciation acknowledges the gradual decline in its overall value. Traditional vs. Accelerated Depreciation Traditionally, an entire property is depreciated at a single rate. Cost segregation breaks the property down into its components, such as roofing, electrical systems, and flooring. Because…