BOMA Supports Extending the 15-Year Leasehold Depreciation Schedule

Your BOMA San Francisco advocacy team was in Washington D.C. recently to talk to our Bay Area Congressional representatives about, among other issues, extending the 15-year leasehold depreciation schedule.

Current Federal Law:

Through the end of 2009, the tenant improvements are depreciated on a 15-year schedule. On January 1, 2010, this will change to a 39-year depreciation schedule.

BOMA Position:

Congress must act now to extend or make permanent the 15-year depreciation period.

Supporting Arguments:

• Leasehold improvements are the build-outs to tenant space from floor to ceiling and everything in between.
• A 15-year depreciation schedule more closely reflects the reality of the marketplace. Leasehold improvements typically don't last longer than 15 years, at most, before they are replaced.
• Job creation and economic stimulation: Indeed, almost $250 billion is invested in commercial real estate improvement annually, with $15 billion of that amount going to leasehold improvements.

Please click here for more details about BOMA San Francisco's Washington D.C. trip