Dental Office Space Sharing Needs Detailed Lease Agreements
A popular trend especially for young dentists starting out is to sublease space in a dental practice. Often it is to test out a geographical area or cut down on expenses until their career takes off and they can build or buy their own dental office space or building.
There are different ways to classify this type of business agreement. The dentists involved can both be on a main lease and have separate practices within one space or one dentist is on the main lease and subsequently enters into a shared medical space agreement / sublease with another dentist. “Shared space” agreements can get quite complex, and in these agreements, it is important for the dentist on the lease (sublessor) and the dentist who wants to use the space for a limited period of time (sublessee) to make sure the proper written agreements and consents are in place.
In some circumstances a dentist will have a lease in place with a landlord and a second dentist will want to utilize the space and/or a portion of the space for a certain fraction of the week or month.
In order for the sublessee to utilize the space, a written consent from the building’s landlord must be obtained. As a result, the dentist on the lease (the sublessor) must get written landlord consent prior to entering into a sublease arrangement with a dentist who wants to use the space for a limited period of time.
In addition to landlord consent, an agreement between a sublessee and sublessor should be in place and be detailed in writing to protect both parties.
The amount of time each party will require for written notice to terminate the arrangement is an important aspect of the agreement. The sublessee should note that if alternative space is not available upon the termination of the arrangement, then they must have adequate notice to complete treatment for patients at the subleased space and provide emergency care in order to avoid patient liability.
Both dentists must have an understanding of what supplies in the practice can be shared and how they are paid for. It can be a daily rate or built into the monthly rent payment, but the sublessee may want to use supplies such as gloves, syringes and bleaching kits – and determining how this is going to be paid for upfront is important.
The sublessor and the sublessee should also not share one telephone number because if the arrangement between the parties terminates, each party will want to have a distinct number for their respective patients.
The dentists also should maintain patient records separately as each dentist has a distinct practice within the space. The agreement between the parties should establish that each dentist is responsible for their own patient records and that solely the patient records of the sublessee are removable by the sublessee upon the termination of the agreement.
The sublessee should have an exit strategy in place regarding next steps if or when the space sharing/sublease arrangement ends. It can take several months to build out a dental office space and in some locales medical or dental office space is limited.