New revenue streams are always of interest to business owners, but an often-overlooked asset is the one that houses your company.
Indeed, whether you own a warehouse, factory or office space, the building from which you run your business has the potential to grow your bottom line. Using our construction and financing expertise, Imperien helps companies find value in the brick-and-mortar they use every day.
Become a landlord. Sometimes, there’s a benefit to moving into a space that is larger than your business needs, so that you can lease out part of the building. The extra rental income can go toward paying down your mortgage, or become additional liquid assets to help with ongoing operations.
Seek out incentives. Whether it’s a tax deduction on energy-saving upgrades or a break on real estate taxes, the government offers incentives to help small businesses. While these won’t amount to enough to cover the cost of your building, they can provide the extra boost a project might need to go from impossible to feasible.
Break out your costs. Known as cost segregation, the idea here is that you can claim depreciated costs on some parts of your building sooner than others. For example, perhaps the electrical outlet used for your manufacturing machine depreciates in five years – rather than the standard 25-to-30 years that building exterior might have.
Using cost segregation, building owners can pay taxes that reflect the earlier depreciation for their electrical system, while using the later depreciation for the building shell. This method helps both reduce and defer and some taxes. And it’s not a matter of nickels and dimes: For some, tax savings can amount to up to two-thirds of the down payment you made to purchase your building.
Cost segregation isn’t only a benefit to new construction or purchases. It also can be applied to rehabilitation or expansion projects.
This isn’t a service offered by all tax accountants, but it is an area of expertise for Imperien.
Offload your debt. There is an option to financially mitigate risk when undertaking a large project: You can sell and then lease back your renovated project.
Consider a manufacturing plant that needs significant upgrades in order to remain competitive, but doesn’t have the cash flow to make that happen. Imperien will purchase your building, assist with the needed upgrades and then lease the building back to you.
It’s a solution that allows businesses to complete projects without it directly hitting their books.
The building where you do business doesn’t purely have to be a storefront or place to house business essentials. It has the potential to give even more back to your bottom line.
To learn more about how Imperien can help turn your building into additional revenue, call us at 815-988-7970 or click on the button below to send us a message.