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With commercial real estate, it might be tempting to expand constantly. However, sometimes the best way to invest your money is to make improvements to your existing properties. Here are some ideas.

You should be aware of the special tax treatment of what is known as a buildout. Consult with a tax accountant before making a move. A leasehold improvement is done when an improvement is made to meet the requirements of a single tenant. The most common one is a buildout done when a new tenant moves into a new office or retail property.

There are three rules to qualify as a buildout:

  1. The landlord or tenant can only do it.
  2. It can’t change the actual building or affect the common spaces.
  3. The investment property must have been used for at least three years.

If qualified, the leasehold improvements can be depreciated over 15 years.


One of the most straightforward ideas is lighting. If you want, you can probably go to the nearest Home Depot and pick up some bulbs. Lighting has a significant effect on how your building looks. Nothing looks more dreary than staid lighting. Additionally, you can purchase energy-efficient bulbs. This will save your new tenant money and help the environment.

Replace Doors

Some doors might be hollow. Replace them with sturdy doors, which will also be more visually appealing. This will also assist in security.

New Floors

Some landlords instantly spring for carpets because they’re relatively inexpensive. However, they have to be replaced quite frequently. Depending on the tenant, it might be every few years. For a more long-term solution, consider wooden floors. These are well-liked by tenants and will attract a higher-quality tenant. Linoleum is also available and can look like wood without the price.

Update Appliances

Buy new appliances if they’re old. Black and white are out of style right now. Stainless steel is in. People love it because it doesn’t discolor as easily.

Improve the Exterior

There are plenty of things you can do. Some properties will benefit from a fresh coat of paint. You can save money by hiring college students. If the walkway is damaged, consider rebuilding it. Regularly cutting the lawn is a small thing but very important.

There are many strategies for real estate. However, improving your properties can be a great way to build value.