Solar for Commercial Rental Properties - a Wise Investment

We have previously written about the multiplying benefits of installing solar on rental properties (commercial, multi-family, and residential). We’d like to revisit this topic, diving deeper into the benefits and detailing some pitfalls to avoid.

When most people consider the benefits of installing a solar PV system, they immediately think about tax credits and their personal homes. However, discerning investors also choose to install solar energy systems on their rental properties. At the end of the day, solar for rental properties can be a great investment. Many of these properties qualify for the commercial solar energy tax credit; they also have significant depreciation benefits. From a long-term investment standpoint, they help the landlord/property owner capture a larger share of the total cost of ownership over the life of the building. This leads to a significant appreciation in rents, a more marketable building, and more flexibility to attract desired tenants.

The price of commercial solar energy systems is competitive, even with the stepping down of the income tax credit. The overall yield to the property owner can be motivating. When structured properly, the owner is cash flow positive from day 1 of system operation, alongside all the above-listed benefits.  This allows owners, tenants, and larger-scale rental communities to reap the benefits of solar energy immediately. (We encourage all clients to seek advice from their tax professional as there are certain classifications of property that do not qualify and there are certain dates required to be met for qualification.)

Multiple studies have shown that a rental unit equipped with a solar energy system is more marketable, rents faster, and is more appealing than a similar unit without a solar energy system. Mathematically, it provides a multiplying benefit in terms of higher rent for decades. It not only provides cost savings and additional income; it tells a motivating story and shows an investment in the environment and in Florida.

Property investors installing solar energy systems see the benefits immediately and continue to experience them for decades to come. At Optimus Solar, we encourage all long-term investors to consider this value-add to their real estate assets, tenants, and communities.

We enjoy sharing our knowledge in this field with all interested and welcome discussion and inquiries at 352-234-3552.