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Selling Your Medical Space

Deciding to sell your medical space is a large decision.  Further, the process of selling real estate itself can be time-consuming and stressful. 

The good news is there are two areas in particular you can act on today in advance of officially putting your real estate on the market to limit the stress and time commitment involved.

AREA #1
Clarify the age and status of your Roof and HVAC system:  

Potential buyers of your space will closely evaluate two particular areas when considering making an offer:  1) the age of your roof; and, 2) the age and quality of your HVAC system.

WHY IS THIS IMPORTANT?

Both the roof and the HVAC system are critical, long-life cycle infrastructure components of your real estate.

Should either of these components be coming close to their shelf-life[1]buyers will be concerned about having to replace them once they’ve acquired the property and will use this information to negotiate with you on the purchase price they are willing to accept.

ACTIONS YOU CAN TAKE IN ADVANCE

  • Reach out to your realtor and/or HVAC vendor directly and confirm the age/type of roof and HVAC system you have and any recent repairs/replacements to both systems.
  • Should investment be required in one or both structures, confirm the exact $ cost involved.
  • Huddle with your realtor and discuss whether or not you’d like to address these issues in advance of putting your property on the market or whether you are ok to factor these costs into the negotiated purchase price once the property is on the market.

*NOTE:  Additional structural items to also take into consideration include the elevator (if applicable), the boiler, and the parking lot surface.

AREA #2
Clinic Layout and Tenant Mix

Potential buyers will also consider the existing layout of your clinic (how administrative and clinical space is allocated across your clinic) as well as any additional tenants currently leasing space in your building.

WHY THIS IS IMPORTANT?

When acquiring medical space, buyers will focus on your floor plan and the mix of tenants in the building. 

They do this because this information is most easily accessible to them and because it helps them understand the business fundamentals underneath your property such as the total leasable space and the $ price per square foot.  

ACTIONS YOU CAN TAKE IN ADVANCE

  • Review your current floor plan with your realtor and get familiar with how much leasable space you own and how it is allocated across your clinic and to other tenants (if applicable).
  • Review any existing tenant leases you have and if any are up for renewal over the next -3 years.
  • Prepare your talking points for all under-utilized / vacant space and what the future plan/vision is to make these spaces productive.
  • If possible, explore renewing your additional tenant leases early as the longer lease terms you have in place for your other tenants, the more attractive your property will be to potential buyers.

The process of selling your medical space never feels easy.  But by preparing in advance for the factors listed above, you can save enormous time and energy and set yourself up to sell your property to the right owner at the right price.  

If you found this article helpful, please share with us your story when it comes to selling your medical space.

[1] The average age of a typical commercial roof is ~30 years.  The average age of an HVAC system is 10 – 15 years.