Multi-Use Commercial Space – La Jolla, CA
A property owner in La Jolla, California, had a multi-use commercial building with retail stores on the ground level, office spaces above, and underground parking. The owner wanted to reduce tax liabilities while reinvesting in tenant improvements to attract higher-end retailers and professional service firms.
Property Type: Multi-Use Commercial Building
Estimated Property Value: $40 Million
Size: 120,000 sq. ft.
Service Modeled: Cost Segregation Study
What We Modeled
Our team conducted a detailed cost segregation study, analyzing distinct components such as structured parking, energy-efficient lighting systems, retail and office tenant build-outs, and zoned HVAC systems. These assets were reclassified to shorter depreciation schedules in accordance with IRS guidelines, enabling the owner to accelerate deductions while remaining fully compliant.
Potential Impact
The tax savings from the first year were reinvested into the property, funding upgrades to retail storefronts and modernizing office interiors. These improvements helped attract high-value tenants and increased lease rates. Continued depreciation is expected to support future capital improvements and long-term value growth in this highly sought-after La Jolla location.
Disclaimer: This scenario is a hypothetical example for illustrative purposes only and does not represent actual client results. Consult with our team for a formal evaluation tailored to your property.