How the Big Beautiful Bill Supercharged CRE Returns with 100% Bonus Depreciation
A Game-Changer for Commercial Real Estate Investors — Featuring 5003 Westone Plaza, Chantilly, VA 20151 as a Case Study
Commercial real estate investors just got a major win. In 2025, the sweeping economic legislation known as the Big Beautiful Bill (BBB) was signed into law, permanently reinstating 100% Bonus Depreciation — a key component explaining how the Big Beautiful Bill supercharged commercial real estate returns with 100% Bonus Depreciation, one of the most powerful tax incentives in the U.S. tax code.
For savvy investors, this means an unprecedented ability to accelerate deductions, reduce taxable income, and enhance cash-on-cash returns. Serafin Real Estate, led by veteran broker Joe Serafin, has seen firsthand how this law is reshaping acquisition strategies across Northern Virginia. The firm recently guided investors through the advantages of the Big Beautiful Bill at 5003 Westone Plaza, a featured case study highlighted below.In this article, we’ll explore how the bill impacts CRE investment strategy and illustrate the benefits using 5003 Westone Plaza in Chantilly, Virginia — a real-world deal that highlights how this new law can transform investment outcomes.
What Is the Big Beautiful Bill?
The “Big Beautiful Bill” is a 2025 economic growth and tax reform package focused on promoting investment, innovation, and U.S. competitiveness. Among its real estate-specific provisions, the bill:
- Permanently restores 100% Bonus Depreciation (which was being phased out)
- Expands eligibility for small-to-midsize business owners
- Provides clarity on real property improvements and asset classifications
- Reinforces the use of cost segregation studies as a tax strategy
For commercial real estate professionals, this bill isn’t just positive — it’s a monumental shift in the financial modeling and post-acquisition tax planning process.
What Is Bonus Depreciation?
Bonus depreciation allows real estate investors to immediately deduct a large portion of a building’s components in the year it is placed into service, rather than spreading deductions over the traditional 39-year schedule.
This includes:
- Interior non-structural improvements
- Carpeting and flooring
- Lighting systems
- HVAC systems serving specific tenant areas
- Parking lot, sidewalks, and landscaping
- Certain plumbing, electrical, and specialty-use assets
To take advantage of this, property owners commission a cost segregation study, which breaks down the building into its individual components and reclassifies them into shorter depreciation timelines (typically 5-, 7-, or 15-year property).
Why This Is a Big Deal
Historically, bonus depreciation was introduced post-9/11, expanded during the Great Recession, and supercharged in the 2017 Tax Cuts and Jobs Act (TCJA) to allow 100% expensing through 2022. But beginning in 2023, it began to phase out:
- 2023: 80%
- 2024: 60%
- 2025: was expected to drop to 40%… until the Big Beautiful Bill passed.
Now, under the new law, 100% bonus depreciation is permanently restored — unlocking millions in upfront tax deductions for investors who act quickly.
Case Study: 5003 Westone Plaza, Chantilly VA
To illustrate just how impactful this change can be, let’s look at 5003 Westone Plaza, a premium Absolute NNN-leased early education facility in Fairfax County, Virginia, exclusively marketed by Serafin Real Estate.
Property Snapshot
| Feature | Detail |
| Address | 5003 Westone Plaza, Chantilly, VA |
| Tenant | Kindercare (Creme de la Creme) |
| Building Size | 21,222 SF |
| Lease Type | 15-Year Absolute NNN |
| Annual NOI | $855,547 |
| Purchase Price | $14,250,000 |
Before vs. After the Big Beautiful Bill
2023 Scenario (80% Bonus)
- Cost Segregation Applied: Yes
- Building Cost Basis: $11,980,000
- Bonus Depreciation (80% Eligible): $1,618,552
- Estimated Tax Savings (37% Bracket): $546,693
- Remaining Depreciation: Phased over 39 years
2025 Scenario (100% Bonus — Post-BBB)
- Updated Building Cost Basis: $12,391,800
- Bonus-Eligible Deduction (High-End): $3,177,052
- Estimated Tax Savings: $1,175,509
- Excess Loss Carryforward: ~$2.32M
Result: The Big Beautiful Bill more than doubled the allowable year-one deduction and tax savings for this property.
Year-One Tax Shelter Impact
| Metric | Value |
| Rental Income (NOI) | $855,547 |
| Depreciation Deduction (Post-BBB) | $3,177,052 |
| Taxable Income After Depreciation | $0 |
| Passive Loss Carryforward (est.) | ~$2.32M |
If you’re a qualified real estate professional, some or all of the depreciation may even be applied against active income, not just passive gains — a major advantage for high-income earners.
Who Qualifies for Bonus Depreciation?
Bonus depreciation applies to investors who place a property in service after purchase or completion of substantial improvements. This includes:
- 1031 Exchange buyers
- Owner-users acquiring buildings for their business
- NNN investors purchasing stabilized assets
- Developers with newly constructed properties
- Real estate professionals with tax planning goals
If you’re acquiring a property, a cost segregation study must be performed — and it must be defensible. That’s why Serafin Real Estate partners with certified cost segregation engineers who deliver IRS-compliant results.
How This Affects Investment Strategy
The reinstatement of 100% Bonus Depreciation transforms how you evaluate a deal:
Cash Flow + Tax Efficiency
With full year-one write-offs, investors can shelter income from multiple properties, reducing federal tax liability and improving equity recapture timelines.
Cap Rate is Only Part of the Story
Now, savvy investors look beyond NOI and cap rates to analyze after-tax returns. The real value is often in the depreciation schedule.
Stronger Offers, Faster IRRs
In competitive bid situations, bonus depreciation can justify a higher price by offsetting upfront tax liability. That means sharper IRRs and faster capital recycling.
Investor FAQ
Q: Do I still get depreciation if I buy through an LLC or partnership?
Yes. The entity structure doesn’t change eligibility for bonus depreciation — as long as the property is placed in service by the taxpayer or the partnership.
Q: What if I’m not a real estate professional?
You can still use depreciation to offset passive income and carry forward any excess indefinitely until used.
Q: How do I apply this to my return?
Work with your CPA. They’ll file IRS Form 4562 and possibly Form 3115 to capture depreciation and change in accounting method.
Q: How fast can a cost segregation study be done?
Typically 2–4 weeks. Serafin Real Estate can connect you with trusted partners who move fast and deliver audit-ready reports.
Bottom Line
The Big Beautiful Bill is more than just another tax reform — it’s a blueprint for how investors can maximize wealth and reduce tax exposure through real estate.
Properties like 5003 Westone Plaza represent the perfect storm:
- Long-term NNN lease
- Corporate tenant
- No landlord responsibilities
- And now, full first-year tax shelter via 100% bonus depreciation
Want to Learn More or See the Full Cost Segregation Report?
Serafin Real Estate is the leading commercial real estate brokerage for institutional and high-net-worth investors in Northern Virginia. We help you uncover hidden value through structured acquisition support, tax-advantaged opportunities, and smart buyer strategy.
Call us at 703-261-4809
Email: info@serafinre.com
Visit: www.serafinre.com
Disclaimer:
This article is for informational purposes only and does not constitute tax, legal, or financial advice. Serafin Real Estate is not a licensed accounting firm, and readers are encouraged to consult with a qualified CPA or tax advisor regarding their specific circumstances.
Source for Cost Segregation Analysis:
The 2025 cost segregation analysis cited in this post was provided by:
Jerry Lotz
CSSI & CostSeg Savings Solutions
410-878-2553
jlotz@costseges.com
https://costseges.com/