A while back the players were on the roof of a building about to explode. They all rappeled off with two of them failing miserably, I think one got a despair. One was wearing a Superior Sakiyan Shadowsuit along with some other gear.

Is damaging their equipment appropriate? I think they were at medium falling distance.

If you've got dice results for it, sure.

Athletics/Coordination check to try roll/brace the landing. Difficulty set on how high your PC is falling with appropriate Setbacks. Negative results damage gear. That Despair you got definitely broke something. Broke something real bad

I see no problem letting some threats or a despair cause damage to equipment. Mind, I would typically do that instead of having them fall, rather than add insult to injury by doing both (unless they had a truly terrible roll, of course).