Depreciation Report - 1975 Commercial Property

Discussion in 'Property Management' started by ACH123, 9th Oct, 2020.

Join Australia's most dynamic and respected property investment community
  1. ACH123

    ACH123 Active Member

    Joined:
    7th Jun, 2019
    Posts:
    34
    Location:
    Gosford
    I know that a Depreciation Report is worth its salt. However, is it worth it for every type of development?

    I have a friend who just purchased a commercial property built in the 70s with no substantial renovations undertaken since. Is it still worth preparing one?
     
  2. Tom Rivera

    Tom Rivera Property Manager Business Member

    Joined:
    1st Jul, 2015
    Posts:
    2,718
    Location:
    South East Queensland
    ACH123 likes this.
  3. Depreciator

    Depreciator Well-Known Member

    Joined:
    15th Jun, 2015
    Posts:
    1,963
    Location:
    Sydney
    Possibly not. The building is certainly too old, so it will depend on what Plant and Equipment (Assets) are in it. What can you tell me?
     
  4. Sean Connolly

    Sean Connolly Active Member

    Joined:
    20th Nov, 2018
    Posts:
    36
    Location:
    Brisbane


    Being a commercial property regardless of age, there should be still depreciation available for this type of property. If you provide the address to a good depreciation firm, they will be able to tell you whether it is worth it or not. But in my opinion it should be.
     
  5. Depreciator

    Depreciator Well-Known Member

    Joined:
    15th Jun, 2015
    Posts:
    1,963
    Location:
    Sydney
    Age is very relevant. It's a 70s building with 'no substantial renovations', which mean there is likely no building depreciation. So it gets down to what Assets (P&E) are in the property.
     
  6. Sean Connolly

    Sean Connolly Active Member

    Joined:
    20th Nov, 2018
    Posts:
    36
    Location:
    Brisbane

    The depreciation on the Division 40 assets should be enough to warrant getting a depreciation report done. A quantity surveying firm providing a quote, will be able to look up the property and determine whether there is enough plant within the property to prepare a report.
     
  7. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

    Joined:
    22nd Jun, 2015
    Posts:
    361
    Location:
    Australia
    Quite possibly. What's the address? Are there pictures online?