The Tax Advantage Most Investors Miss
100% Bonus Depreciation on NNN Assets. Structured Correctly, It Changes Everything.
Most investors buy NNN properties for the passive income and predictable cash flow. That is a good reason. But the investors building real, generational wealth through net lease are doing something else entirely — they are using bonus depreciation to dramatically accelerate their tax benefits in year one.
Under current tax law, certain NNN property types allow investors to claim 100% bonus depreciation on qualifying components in the first year of ownership. On the right asset, this can mean writing off a significant portion of the purchase price immediately — not over 27.5 or 39 years, but now.
This is not a loophole. It is a legitimate, well-established tax strategy that sophisticated investors and family offices use every day. But it requires the right asset, the right cost segregation study, and a broker who understands how to structure the acquisition to maximize the benefit.
That is where I come in.
The Big Beautiful Bill: A Boon to Car Wash Investors
On July 4th, 2025, President Trump signed the One Big Beautiful Bill Act (OBBBA) into law — an impactful development for the U.S. car wash industry. Chief among its provisions related to car wash stakeholders is the reinstatement of 100% bonus depreciation, a powerful tax incentive last in place from 2017 to 2022. This policy, along with several other measures in the bill, is poised to stimulate activity in car wash mergers and acquisitions, sale-leaseback transactions, and new site development.
For NNN car wash investors, the timing could not be better. The combination of strong operator demand, long-term lease structures, and now the reinstatement of full bonus depreciation makes this one of the most compelling asset classes in the net lease market.
How It Works — The Numbers
When you acquire a qualifying NNN asset, a cost segregation study is performed to identify and reclassify building components into shorter depreciation categories. Under 100% bonus depreciation, those reclassified components can be deducted entirely in the first year of ownership.
Here is what that looks like in practice:
100% Bonus Depreciation for NNN Car Wash Investments
Depreciation Breakdown — Example Comparison
| Car Wash | Typical 39-Year Property | |
|---|---|---|
| Asset Type | Car Wash | Typical 39-Year Property |
| Ownership | Fee Simple | Fee Simple |
| Rent | $300,000 | $300,000 |
| Cap Rate | 6.00% | 6.00% |
| Purchase Price | $5,000,000 | $5,000,000 |
| Est. Land Value (20% of PP) | $1,000,000 | $1,000,000 |
| Est. Building Value (80% of PP) | $4,000,000 | $4,000,000 |
| Useful Life | 15 Years | 39 Years |
| Federal Tax Rate | 37% | 37% |
| Est. Year 1 Depreciation | $4,000,000 | $1,035,000 |
| Est. Year 1 Tax Savings | $1,480,000 | $383,000 |
| Tax Savings Comparison | $1,097,000 | Estimated Additional Tax Savings Versus a 39-Year Property |
| Est. Depreciation Years 1–5 | $4,000,000 | $1,347,000 |
Colliers International or Christopher Twist is not a tax or cost segregation advisor. Investors must contact tax and cost segregation professionals to understand how 100% bonus depreciation applies to their individual investment opportunities. Numbers provided are estimates for example purposes. Example assumes maximum depreciation taken in year 1.
The result is clear: on a $5 million NNN car wash acquisition, an investor can potentially realize an estimated $1,480,000 in first-year tax savings — nearly $1.1 million more than a typical 39-year depreciable property at the same purchase price. You are collecting passive NNN income from a credit tenant on a long-term lease, while simultaneously capturing an outsized tax benefit that most investors never realize is available.
Which NNN Assets Qualify?
Not every net lease property offers the same depreciation opportunity. The key is the ratio of land value to building and site improvement value. Properties with significant depreciable components — equipment, specialized structures, site improvements — offer the greatest advantage.
Property types that commonly offer strong bonus depreciation benefits include:
Car Wash Properties
Express tunnel car washes are among the most compelling NNN assets for bonus depreciation. The specialized equipment, tunnel systems, water reclamation infrastructure, and site improvements can represent a large percentage of the total purchase price, creating substantial first-year deductions.
Quick Service Restaurants (QSR)
Kitchen equipment, drive-through infrastructure, signage, and interior buildout can qualify for accelerated depreciation.
Convenience Stores / Gas Stations
Fuel systems, underground tanks, canopy structures, and specialized equipment create depreciable component value.
Auto Service / Auto Parts
Lifts, bays, specialized equipment, and service infrastructure qualify.
Other single-tenant retail assets may also offer meaningful depreciation benefits depending on the specific buildout and improvements.
Why You Need a Broker Who Understands This
Most commercial real estate brokers sell properties. I help investors structure acquisitions that align with their broader tax and wealth-building strategy. This means:
Identifying NNN assets with high depreciable component ratios before they hit the open market
Advising on purchase structures that maximize bonus depreciation eligibility
Connecting investors with qualified cost segregation professionals and tax advisors
Thinking beyond the cap rate to the total return picture — cash flow, appreciation, and tax savings combined
This is not tax advice — every investor should work with their own CPA and tax counsel. But understanding which properties offer the greatest depreciation opportunity, and structuring the deal to capture it, is part of what separates a transaction from a strategy.