When you’ve decided your dental practice needs a different space, there are several factors you should keep in mind to help you make the right choice.
Know Your Space Needs
First, you should consider your space needs. Specific details that may affect the practice’s choice of space include:
- Patient flow considerations, including preserving privacy
- Number of operatories planned for the practice
- Sterilization and maintaining facility hygiene
- Expansion potential
You should consider the balance between the affordability of rent and the ability to grow the practice if the practice acquires substantial patient business. You may negotiate lease terms for your practice that enable you to develop the space to meet your specific needs, such as buildout allowances. Considerations such as the need to provide specialized medical care can make choosing commercial space more challenging for your practice than for other commercial or retail tenants.
Key Lease Provisions Dentists Should Focus On
Some of the most critical commercial lease provisions that you should focus on when negotiating a lease agreement include:
- Exclusivity clauses: Your dental practice should have an exclusivity clause that bars the landlord from leasing space in the same property to another dental practice.
- Lease term and renewal options: Negotiating a longer lease term or securing the right to force a lease renewal can help you avoid disruptions caused by having to relocate to a new space.
- Tenant improvement and build-out allowances: You may negotiate financial incentives that allow you to avoid construction for specific facilities or utilities.
- Assignment and subletting: Lease terms can provide you with flexibility in subletting or transferring the lease to another dental practice if your practice needs to downsize or relocate to a different space.
- Common area maintenance charges: Look out for these. Leasing space in a multi-tenant building can come with hidden charges in the form of CAM fees, which cover the cost of property landscaping, security, and maintenance of common areas, such as lobbies or hallways.
- Relocation rights: You should watch out for lease terms that allow the landlord to relocate your practice to another suite in the property.
Negotiating Tenant-Friendly Terms
During lease negotiations, you can push for more tenant-friendly terms for your dental practice. For example, you can focus on mitigating the severity of rent escalation clauses to avoid years where the practice faces a substantial increase in rent costs. Flexible renewal terms can also help your practice stay in a space that continues to suit their needs or move out with limited liability to the landlord when your practice outgrows the space.
Your practices can defray the costs of moving into a new space by negotiating build-out allowances to help cover the cost of tailoring the space to your needs, or by securing free rent periods that provide a runway with no rent expenses. You may also negotiate signage rights that help make the practice’s location visible to visitors to the property.
If you and your practice have long-term investments in heavy equipment and have developed a robust patient base in a community, you may prioritize tenant-friendly terms that ensure stability in a specific location.
The Importance of Legal Review
Complicated agreements commonly used for commercial leases often incorporate terms that favor the property owner. However, unlike residential leases that usually use standard forms, commercial tenants can negotiate custom lease terms, creating a more balanced landlord-tenant relationship. You can best protect your dental practice’s interests by working with dental attorneys experienced in commercial leases. Such an attorney can identify the specific risks associated with leasing space for a dental practice and negotiate more favorable terms for you.
Contact Our Firm Today
When you choose to lease space for your dental practice, knowing about the issues that can arise when negotiating a commercial lease can help you protect your legal interests. At Mahan Law – Dental Attorney, we can explain more about the considerations you should keep in mind when you’re leasing real estate for your dental practice. Call or contact us online today.
