I purchased a commercial building in 2013 that is mixed use. The upstairs was old apartments that we tore down to the studs and have over the course of the three years completely redone some of the units. In round numbers, building was $230k, included in loan was $140k for improvements of various kinds including electrical improvements, new carpeting in offices, etc. and things we did to the other areas of the building. The loan was not enough to complete all the work so we have slowly raised the funds to finish the main 2nd story improvements ourselves and are finally near completion. The funds spent in prior years essentially did not improve value of the building much since they were not complete and we could not realize any revenue from the improvements, but the loan has been in place for a few years now. Do the improvements get recorded in chunks, or as one complete project for depreciation purposes since obviously they can not be expensed. If it matters much, the rest of the building in lower level is warehouse, dock space, offices, etc. that we rent to ourselves since we established a separate LLC to hold the property.
