Senior living and multifamily housing projects are some of the most capital-intensive developments today. Rising construction costs, higher financing rates, and investor pressure for yield mean developers can’t afford to leave money on the table.
The good news? The IRS has built-in incentives that can free up millions in cash flow without changing your NOI or cap rate. At Tax Logic™, we specialize in unlocking these hidden advantages so your project can scale faster, attract investors, and maximize long-term value.
1. Cost Segregation: Accelerating Deductions
Instead of waiting 39 years to depreciate your building, cost segregation reclassifies assets like flooring, electrical systems, and non-load-bearing walls into 5-, 7-, or 15-year property. That means developers can front-load deductions, often producing:
- $1M+ in year-one tax savings on a $25M project
- More immediate cash to reinvest in operations, marketing, or additional sites
2. Reusable Walls with Green Zip™ Technology
Senior living and multifamily spaces often require flexible layouts—converting rooms, adding medical suites, or adjusting common areas as needs evolve. With Green Zip reusable walls:
- You get accelerated depreciation because walls qualify as personal property, not 39-year real property
- You gain flexibility for repositioning units as market demand shifts
- You boost resale value, since future operators inherit a building that adapts at lower cost
3. Section 179D Energy Efficiency Deduction
Energy efficiency isn’t just good for the environment—it’s good for your balance sheet. Under Section 179D, qualifying senior living and multifamily projects may earn up to $5.81 per square foot in tax deductions. That’s hundreds of thousands in additional cash flow for projects starting before the 2026 sunset deadline.
4. Proof Stacking: Re-Pricing Deals with After-Tax ROI
When you layer these incentives together—cost segregation, Green Zip™, and 179D—you don’t just lower taxes. You change the economics of the deal.
- A project that looks like an 8% return on paper can turn into 11% after-tax ROI once incentives are applied
- That kind of proof stacking helps developers raise equity faster and close deals in a competitive market
Conclusion
Senior living and multifamily developers don’t have to settle for razor-thin margins. By leveraging IRS-backed strategies, you can unlock cash flow today, build more flexibility into your projects, and increase investor confidence tomorrow.
📩 Ready to see what these incentives can do for your project?
Email nick@nicktaxlogiccre-com for info, let’s unlock your hidden cash flow.
