10 Steps to Finding and Negotiating for
a Dental Office Location

Thankfully, finding a dental office location and negotiating for it is something you’ll rarely have to do. I say “thankfully”, because the process is one with which you probably have little familiarity and it can be fraught with difficulties and rude surprises. At the very least, it’s very time consuming and generally takes you through lots of unfamiliar territory. So, when you’re faced with these challenges, having a well-thought out plan and following it deliberately will result in a substantial savings for you in time and money and a significant reduction in the hassles and stress normally associated with the process.

A Ten Step Process

A good location search and negotiation plan is one that combines (i) thoughtful establishment of the location, site, space and lease terms criteria; with, (ii) coordinated search, evaluation and negotiation procedures and techniques. None of these elements, however, should be developed without input from various professionals who have experience in the required disciplines. Your plan can be summarized in the following 10 sequential steps.

Planning Stage

STEP 1: Select professional team members. Among others, these should include equipment, finance, practice management, design, real estate, construction, legal and accounting experts. With early input from these professionals, you are better prepared to proceed through the remaining steps. Find out at the very start when they think the best time is to bring them in.

STEP 2: Set scheduling goals. When do you want to make the move? What must be accomplished and upon what schedule?

STEP 3: Consider timing. When does your current lease end? What are current market conditions for leasing or buying? Is this a good time to be making this move with respect to your long-term financial plan, your family circumstances and in the life of your business?

STEP 4: Define your criteria. Where do you want to locate - geographically? What type of setting - strip mall? High rise? Professional building? Free standing? How large a space? Do you require any special amenities? How much parking will you require?

STEP 5: Organize the search. Develop the methods you will employ to locate potential locations and establish an efficient property evaluation procedure that requires the least amount of chair-time disruption.

Action Stage

STEP 6: Conduct the search. Employ brokers, drive the area, scan the newspapers, check on-line space listings, and ask family, friends and your equipment/sales reps to keep an eye out.

STEP 7: Evaluate the opportunity. Is it where you want to be? Is it the right size? Is it in the type of setting that will best project the public image you desire? Does it have sufficient parking and signage? Is it available in your time frame?

STEP 8: Establish your negotiation positions. What’s the longest initial lease term you will commit to? What’s the minimum number of renewal options years you’ll accept? How much are you prepared to pay in annual occupancy costs? How much are you prepared to invest in build out? Are you prepared to provide a personal lease guaranty? Your professional lease negotiator will help you establish your positions.

STEP 9: Negotiate the economic terms. Your professional lease negotiator negotiates the economic terms before the landlord drafts a lease document. These economic terms typically include: rental rate, inclusions, rent start date, amount of landlord contribution to build out, etc. Your professional lease negotiator will secure the best terms for you.

STEP 10: Negotiate the lease document. Once the economic terms are agreed upon and inserted in the landlord’s form lease, your attorney negotiates the dozens of legal concepts that provide the context for the landlord/tenant relationship. Your attorney will secure the best legal terms for you.

The foregoing is not meant to address every single phase of the process. However, it does provide a basic outline for you to follow. As your office lease is one of the largest and most important contracts you will ever sign in your life, it’s critical that you employ every measure at your disposal to reduce the possibility of making choices that do not serve your long-term goals. Plan thoroughly, leave your rose-colored glasses at home when evaluating a location opportunity and, most importantly, recognize your limitations (in time and expertise) and seek professional guidance.