Executive Summary

A 175,000-square-foot multifamily apartment complex in Nevada, placed in service in 2022, achieved a full Section 179D deduction of $1.88 per square foot, resulting in approximately $330,000 in federal deductions retained by the building owner.

The project qualified through whole-building energy modeling that demonstrated energy cost savings across lighting, HVAC, and envelope systems, supported by in-house Professional Engineer certification.

Project Overview

• Building Type: Multifamily (Apartment Complex)

• Project Type: New Construction

• Location: Nevada

• Gross Square Footage: 175,000 SF

• Placed in Service: 2022

• Delivery Method: Design-Build

• Project Leadership: Owner-led

• Owner Type: Private Developer

The Section 179D deduction was retained by the owner and claimed as an immediate tax deduction in the year the building was completed.

Technical Methodology

A whole-building energy model was prepared using eQUEST, benchmarking the proposed design against an ASHRAE 90.1-2007 baseline.

All major building systems were explicitly modeled together to assess overall building energy performance.

This integrated modeling approach allowed the project to qualify even with moderate per-square-foot savings, reflecting typical multifamily energy profiles.

Efficiency Measures Evaluated

Lighting

• LED lighting in common areas

• Occupancy sensors in shared spaces

HVAC

• Air Handling Units (AHUs) with Dedicated Outdoor Air System (DOAS)

• Demand Control Ventilation (DCV) to reduce ventilation energy during low occupancy

Building Envelope

• High R-value roofing insulation

• Envelope performance contributed meaningfully to overall energy savings

Results & Deduction Outcome

• Deduction Achieved: $1.88 / SF

• Total Deduction: ~$330,000

• Deduction Type: Full building

• Systems Used: Lighting, HVAC, and envelope

• Model Iterations Required: No

The project met the required energy reduction threshold without additional modeling iterations.

PE Certification & Documentation

Professional Engineer: In-house PE

Certification Scope:

• Energy model review

• Site inspection

• Final certification

Documentation was prepared to support tax filing and potential audit review.

Key Takeaways

• Multifamily projects can qualify for full Section 179D deductions even when per-square-foot savings are modest.

• Envelope strategies, such as high R-value roofing insulation, can materially support qualification in residential-style buildings.

• Owner-led, design-build projects benefit from streamlined documentation and faster certification timelines.

• Section 179D provides owners with a direct, immediate tax benefit upon project completion.