

Here are five provisions that you should have in your dental
practice lease:
1.
Death and Disability
2.
Relocation Provision
3.
Rentable v. Useable Square Footage
4.
Exclusivity
5.
Assignment & Subletting
Let’s take a further look at what each of those are.
In an ideal world, this would go into every single lease. It
allows your spouse or your estate to get out of the lease in the event that
something should happen to you. If it gets accepted, great, if it doesn't, don't
lose sleep.
A lot of leases have a clause in it that allows a landlord
to relocate you to another location - sometimes to not as great of a location
as you currently have. This is normally on the landlords dime, so they are
normally hesitant to do this. However, if they have bigger plans for your
current location, they will move you. You want to make sure that your relocation clause has
language that forces your landlord to pay for all of your moving costs,
construction, and try to get language in that allows you to be the one to
approve the move you'd be even better off.
Rentable square footage is the square footage that you pay
rent on. What's the difference between rentable and useable square footage?
Well, in your rented square footage you'll have to take into account shared
lobbies, common areas, elevator shafts, restrooms, etc. Those are all included
in your rentable square footage. Always ask your broker or landlord about what
the rentable AND useable square footage is so you advise your designers and
others, so you know what's going to fit in your useable space.
Language that you or the landlord would want to put in that
basically precludes the landlord from putting another tenant that does your
work (in your industry, i.e. another dentist) in the building. This is particularly recommended if you're a
specialist - for instance orthodontist, pediatrics, endodontist, oral surgeon,
etc. Not to exclude other dentists
outside of your specialty, but if you're a pediatric dentist you should seek
exclusivity as a pediatric dentist preventing others with that same specialty
from taking up tenancy in the building.
For those that are general dentists, you may consider getting
exclusivity for general dentistry, not for dentistry as a whole. The reason is this: If you're a general
dentist and an orthodontist takes up tenancy in the building/shopping plaza it
could drive more business to your own practice.
This can often times be overlooked but is important to have
in your dental practice lease. If
something happens to you, your life changes, you need to move, you need to
sell, etc. you want to be able to sell your office and transfer your lease to
someone else without the landlord having too much power in terms of those
negotiations. Be mindful of the language in this section as there are some out
there that have included language that demands a percentage of the sale, a fine,
or even that the landlord would be allowed to take back the property.
If you’re not comfortable with the provisions in your lease
(or lack thereof) it’s okay to counter.
Working with a real estate broker can also help understand your lease options. You’re not powerless in negotiating your
lease. Landlords know the value of
leasing to dental practices. Carefully
review everything and do your homework.
Dental B-School is full of information and
resources to help you avoid any costly mistakes. Dig into our free resource section for more information or contact us to
schedule your strategy session today.
Sign in/up with Facebook
Sign in/up with Twitter
Sign in/up with Linkedin
Sign in/up with Google
Sign in/up with Apple
Wouldn't it be a good idea to create a course?