Functional Obsolescence Suppose a small office building without air-conditioning is in a market where this feature is standard. Because of retrofit requirements, it is more costly to install the air-conditioning now than it would have been as a part of the original construction. The current cost to install the air- conditioning is $12,514. If the work had been done as a part of the new construction, the cost would have been only $8,030. Installing air- conditioning would allow the property owner to raise rents, and effective gross income would increase an estimated $4,715 per year. the current effective gross income multiplier (EGIM) is 9.4. What is the depreciation for functional obsolescence?

Suppose a small office building without air-conditioning is in a market where this feature is standard. Because of retrofit requirements, it is more costly to install the air-conditioning now than it would have been as a part of the original construction. The current cost to install the airconditioning is $12,514. If the work had been done as a part of the new construction, the cost would have been only $8,030. Installing airconditioning would allow the property owner to raise rents, and effective gross income would increase an estimated $4,715 per year. the current effective gross income multiplier (EGIM) is 9.4. What is the depreciation for functional obsolescence