A Brief Introduction to Capital Improvements

 

Capital Improvements pic

Capital Improvements
Image: investopedia.com

Ana Docoito-Nelson serves as a property manager for Gramatan Management, Inc., in New Rochelle, New York. As such, she oversees daily operations for the company’s properties and handles community emergencies. Furthermore, Ana Docoito-Nelson improves property values through capital improvements.

Capital improvements are property restorations or the addition of a permanent structural change to a property that adapts it to new uses, expands its useful life, or increases its overall value. According to the Internal Revenue Service, capital improvements must have a life expectancy of at least a year when installed, and they can be included in a property’s cost basis, thus reducing the taxable capital gain if property owners sell the property.

The distinction between a capital improvement and a repair often comes down to the impact the project has on the property in the future. Repairs are necessary to keep properties in good condition and may include such things as fixing leaks or painting the building. These types of projects are not included in the cost basis unless they increase the value of the property. Capital improvements, by contrast, must be a permanent part of the property; if removed, they would damage the property. A new hot water heater or kitchen cabinets are examples of capital improvements.

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Gramatan Offers Financial Management and Capital Improvements Services

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Gramatan
Image: gramatanmanagement.com

A graduate of business marketing at the Westchester Community College, Valhalla, New York, Ana Docoito-Nelseon provided support to the president of Elisa Dreier Reporting, Corporation and managed day-to-day operations of the office. Today, Ana Docoito-Nelson serves as a property manager at Gramatan Management, Inc., a property management services provider to co-ops, condominium units, and homeowner associations.

Property management firms, such as Gramatan, exist to maximize return on investment by taking property management concerns relating to financial management and capital improvement.

Financial management requires a complete understanding of a property’s budget and operating expenses. Gramatan Management, Inc. conducts ongoing financial analysis, supervises disbursements and payments of building expenses, and prepares annual budgets for its property owners.

Capital improvement, on the other hand, entails maintenance, restoration, and improvements on a property’s structure and facilities to add to its overall value. All improvements must be substantial and permanent. Gramatan combines quality and cost by monitoring the improvements at a competitive pricing.