Healthcare Realty Helps Medical Professionals Cut to the Chase
Is it better for medical professionals to lease or purchase commercial property they are planning to practice from? That depends on your current situation, your comfort level and your future plans. But, be aware that leasable healthcare realty space is much more accessible than commercial properties for sale.
Owning your own space or building it from the ground up is an ideal scenario. You can always lease out space you don’t use. But the snag is that approximately 98% of all suitable commercial space is for lease, not for sale.
Many good locations for a practice such as office towers and strip plazas are already owned by a landlord who does not want to sell you the property, but rather wants you as a long-term, rent-paying tenant (and doctors, typically, are very desirable, steady tenants who can remain in the same property for 20 or 30 years and beyond when the practice is sold),
Major factors that impact a decision for a doctor tenant are the long-term commitment of purchasing a building and the ability to obtain the financing. Before you buy or lease commercial property, however, here are just a few of the pros and cons for each process for you to carefully consider both the good and the bad aspects of healthcare realty.
Good: It can be better to pay a mortgage than a lease because eventually you will pay off the mortgage and own it. Often, the monthly mortgage payment is also very close to the monthly rent payment.
Bad: You might have to sacrifice location strength or visibility. Many of the ownership opportunities are in secondary properties and not on the busier, accessible streets
Good: Your equity in your property will usually increase over time. The building and the land value can both increase. The appreciated value will, if course, vary depending on location.
Bad: You might have to move out or away from your current space giving up a well-established location that another doctor could lease.
Good: You won’t have landlord issues so you feel in control and can open and close your practice when you want. Ownership does have advantages – usually.
Bad: You may have to become a handyman or deal with various ownership issues like Heating, Ventilation and Air Conditioning (HVAC) units, building maintenance, grass cutting, snow removal and such that would otherwise be taken care of for you by a landlord.
Regardless of your choice to buy or lease, the bottom line is: work with a professional medical real estate management group that lives, breathes and understands the pitfalls of the healthcare realty market. Knowing where to look and when to act, can mean the difference in nailing an exceptional opportunity for your new medical office space.