Breaking down a lease for your dental practice can sometimes seem like an exercise in futility if you are not well-versed in real estate legalese. It is far better to trust a dental practice consultant from Reliance Consulting, LLC, to handle the ins and outs of your lease. We’ll make sure that it not only is affordable, but that it is not an impediment to building a thriving dental practice.
A dental CPA from Reliance will spend the time required to conduct the required research for you, then analyze what should be included in your practice’s commercial lease. In the course of breaking down a lease for you, we also will begin to formulate a strategy regarding what terms should be (and can be) negotiated. As an example, one question you might want to consider is whether you would be willing to accept a longer term with more years on the lease in exchange for a lower monthly payment. Or, depending on where your dental practice is in its growth, a shorter term might be more beneficial. Remember, it is important to plan your space based on your future needs. Moving a practice can cause significant disruptions and loss of revenue.
In addition to those factors, there are a number of other items to consider when breaking down a lease:
- Build-out allowance
- Built-in escalations on rent (if any)
- Lease renewal conditions
- Length of personal guarantee
- Determining responsibility for utilities such as phone, electricity, and water
- Determining responsibility for upkeep and maintenance
- Security deposit requirements
- Signage rules & advertising restrictions
- Zoning assurances
- Sublease stipulations
- Termination stipulations for landlord and tenant
If you are in the market for a new facility for your dental practice, or if your practice is expanding and you need to find a new location, contact your dental CPA at Reliance. We will analyze your lease and work with a competent local real estate attorney to negotiate optimal terms. Sometimes you may not have the leverage to negotiate better financial terms but you may be able to remove certain restrictions or covenants that could harm you in the future, if conditions change. For example, three new competitors in the same vicinity could significantly impact your new patient growth and moving your location might be a wise choice. A restrictive lease covenant could hold you down in a bad situation for several months or even years. Location is an important element of your dental practice success and your lease can sometimes make or break you. At Reliance, our job is to help you with every facet of dental practice management.