Waiting Room.jpg

FREQUENTLY ASKED QUESTIONS

The Importance of Representation

Question: How do I know if the building or space will work for my practice?


Regardless of what anyone tells you, you can’t fairly represent two opposing parties. Both parties may have a desire to sell and purchase a business, real estate or another asset but if one side’s desire is to get the lowest price and the other side’s desire is to get the highest price, they are competing and opposing interests. There is nothing wrong with the owner or seller of a building, practice or company having representation. If you were selling a building, practice or company, you would most likely want to hire representation also. If you are acting as a tenant or buyer, it is imperative that you have representation that only represents your interests.




Question: Is it expensive to hire an agent?


If you are acting as a tenant or buyer, you should never pay a dime for representation. In both residential and commercial real estate, the industry standard is for landlords and sellers to pay commissions to both their agent and the buyer’s or tenant’s agent. Avoid being taken advantage of by securing a qualified and well-trained healthcare real estate agent.




Question: Can I truly save money by working with a healthcare real estate expert?


Tens to hundreds of thousands of dollars. If your lease payment is off by even a small amount of money, it can add up to a significant loss of money over 10 years in unnecessary, higher payments. Likewise, if you don’t receive the proper amount of build out period, free rent period, tenant improvement allowance and more, you can leave the same amount of money on the table.




Question: If tenants and buyers can hire real estate agents for free, how do they get paid?


Because sellers and landlords pay commissions for both their listing agent as well as the buyer’s or tenant’s agent in commercial real estate transactions, an agent can exclusively represent your interests as a tenant and buyer for free. While this is definitely not a secret in residential real estate or to experienced corporations and businesses, many healthcare providers don’t realize the same is true in commercial real estate. Most landlords are represented by a listing agent who specializes in helping the owner maximize their return on each transaction. We, as the tenant representative, will simply split the commission with the landlord’s listing agent. Even if a landlord does not have an agent, they still pay the tenant agent’s commission, as that is standard practice in both residential and commercial real estate.




Question: Does a real estate agent take the place of an attorney?


Real estate agents cannot perform a legal review of your lease. A licensed real estate agent is also only permitted by law to populate blank fields on a pre-approved form contract. If a real estate agent were to give legal advice, draft legal language in a contract or perform any other activity that resembles practicing law, then they’re not only putting their client at risk but they’re also subjecting themselves to serious consequences, including losing their license, risking a potential lawsuit, paying substantial fines, jeopardizing the completion of the purchase, sale or lease, forfeiting commissions and risking or permanently damaging their career.




Question: Are there any real benefits to hiring an agent?


Saving dozens of hours of valuable time. Avoiding costly pitfalls, complications and delays. Saving a substantial amount of money. Obtaining significant concessions. Ensuring your interests are always first and protected. Giving you peace of mind that you are in the best property and achieved the most favorable terms possible.




Question: Is it possible for the landlord or seller to also represent me?


You cannot fairly represent two opposing parties. Both parties may have a desire to sell and purchase a practice or company, real estate or another asset but if one side’s desire is to get the lowest price and the other side’s desire is to get the highest price, they are competing and opposing interests.




Question: Can't I always just choose to do my own negotiating?


Unfortunately, many tenants and buyers try this approach, only to discover they are not sure if the property or space really is the best location or option for them and more importantly, they are not sure they are receiving the best possible terms. Bringing in a healthcare real estate agent at any time in a transaction is better than going it alone. However, the longer you wait and the more you try to accomplish on your own, the harder it is for your agent to undue mistakes and expedite the transaction. Your agent would need to undo any communication errors you potentially made, begin the process over from where it should have been at the beginning and navigate a seller, landlord or listing agent who is probably frustrated at that point of a transaction. You can save yourself a lot of wasted time and energy by hiring the most qualified representation you can find. Then, let them direct the process and achieve the most favorable results possible.




Question: Do I need a negotiator as my agent?


You should never pay anyone to be your agent if you are a tenant or buyer. While you should always have an attorney review any legal contract in every transaction, the attorney should not be finding properties or negotiating economic or business deal points, any more than your agent should not be drafting legal language. The best attorneys won’t try and be a real estate agent. Likewise, the best real estate agents won’t even consider drafting legal language or telling you that they can be your attorney.




Question: What is the big difference between residential and healthcare real estate?


There is a huge difference between residential and commercial real estate. The best residential agents wouldn’t even consider doing a commercial transaction and the best commercial agents don’t dabble in residential either. Each sector has a very different approach to the market and commercial real estate has dozens of additional business and economic considerations that residential real estate does not have. A residential agent is typically making value determinations solely based upon comparable properties in the market. On the other hand, a commercial agent understands how concepts like tenant improvement allowance, build out time, free rent, annual escalations and other options impact profitability.




Question: Does the landlord pay a commission for the tenant?


Yes, landlords pay commissions for the tenant’s agent and their listing agent, on both new leases and on lease renewals. Every large national corporation knows this, as do the majority of business owners. Some landlords will try to intimidate a smaller or local tenant and claim that brokerage fees are not paid to agents for lease renewals. However, this is simply a posturing tactic. Many landlords assume healthcare providers are unsophisticated and don’t know better when it comes to commercial real estate and, unfortunately, the majority don’t. Landlords are also notorious for using intimidation and scare tactics to force inexperienced tenants to forfeit their rights and opportunities.




Question: What if my consultant or an attorney wants to be involved?


There is no need for a consultant or attorney to be involved. Communicate that you want their help in the area that they specialize in but the key to achieving the best terms possible is having each partner on your team perform the task and responsibilities they are most qualified to perform. Let your consultant be the consultant and your attorney be the attorney. Likewise, your agent should never try to be an attorney or another key partner on your team.




Question: Should I hire an attorney?


Yes, lease and purchase contracts are legally binding documents. You receive the benefit of occupying and / or owning the space or building, and with that benefit, comes obligations of what you have to do to maintain that occupancy or ownership. When looking for an attorney, your healthcare real estate agent should be able to give you the names of several attorneys that you can interview, to determine who can offer you the best combination of value, protection, price, etc.




Question: Isn't it easier to simply call the listing agent myself?


One of the most common mistakes a tenant makes when looking for real estate for their practice is to contact a listing broker to get information, and then inadvertently begin working directly with the listing agent or owner. The reason this can be such a costly mistake is because healthcare providers typically do not understand the dynamics of the relationships involved.




Question: How can it be that new tenants get better deals on lease renewals than existing tenants do?


It should not, unless you have poor representation and do not fully understand your options. It is easy for a landlord to take advantage of a tenant who attempts to go it alone, or who hires an unqualified agent, or who doesn’t fully understand all their options or the market, and doesn’t have the correct approach. They would love to charge you more than they should and give you less concessions than a brand-new tenant would receive.




Question: What makes HFS different than other healthcare real estate brokers?


HFS is a leader in healthcare real estate brokerage and design.

We take great pride in helping dentists, physicians, physical therapists, and veterinarians improve the success of their practice.

Whether you are opening a new office or expanding your existing healthcare facility, HFS has the expertise you need to navigate the cumbersome process with a single source of accountability.

Our professional services include real estate brokerage, feasibility studies, space planning/test fits, architectural and interior design, design-build, and advisory services.

We represent the interest of every type of healthcare specialty and truly understand the nuances and unique design needs for your practice.

Our experts handle all the details and logistics using our proven process, allowing you the time you need to focus on what is most important, your practice!





Key Things to Consider

Question: Is real estate really that important to my practice?


For most healthcare practices, real estate is the 2nd or 3rd highest expense behind payroll. While payroll is minimally negotiable, real estate is 100% negotiable. And with it, comes the ability to increase and maximize profitability in a manner that typically exceeds managing or negotiating any other top expense. The difference between a properly or poorly negotiated real estate transaction can cost or benefit you tens to hundreds of thousands of dollars over just a ten-year period. With this much at stake, hiring expert representation and maximizing every real estate opportunity is paramount.




Question: What are lease concessions?


In commercial real estate, lease concessions are incentives, discounts or benefits given by landlords and received by tenants in a lease transaction. Offering concessions to a prospective tenant or a renewing tenant is a competitive way for the landlord to market their property and keep their tenants from locating elsewhere.




Question: Are office condos a good option?


An office condo can be an excellent purchase option, especially for buyers who are interested in purchasing a space now vs. developing or building their own property, or who have a smaller size requirement. Those requirements could look like: 1,000 to 10,000 SF; or someone who want the benefits of owning but doesn’t want to take on all the ownership and management responsibilities of running and managing a property by yourself.




Question: How do I know if I'm getting the best terms or conditions on my lease?


Follow these simple steps: Hire an agent that only represents healthcare tenants and buyers. Make sure you fully understand the market and all your top property options. Evaluate both lease and purchase options; office vs. retail vs. MOB, etc. Evaluate detailed economic comparisons. Hire an excellent real estate attorney. Allow your agent to create a custom strategy for your next real estate transaction and then help you execute.




Question: Are there significant differences between office and retail building space?


While there are many classes, variations and vintages of office, retail and MOB space, the main comparisons typically boil down to: window lines and natural light, signage and exposure, cost, maintenance performed by the landlord vs. the tenant, building amenities, synergy or diversity of other tenants, parking, access and more.




Question: When is the best time to begin searching for my healthcare real estate needs?


As a general rule, if you are a tenant or buyer, you should contact a healthcare real estate agent 24 months prior to your upcoming transaction to start establishing your course of action. You are always better to plan ahead and be a little early instead of too late, as timing plays a major role in identifying the top property options available and securing the best possible terms.





About HFS

Question: What specific checks and balances do you deploy that help benefit your clients?


We customize a specific game plan and strategy for each client’s unique requirements and desired objectives. Several of our most impactful processes, include: market evaluations, site selection, demographics, heat mapping, purchase vs. lease comparison, lease analysis, negotiation strategy, assembling the most qualified team, and much more. Whether you’re opening your first office or scaling to hundreds of locations, every real estate transaction matters. We know that your continued success is predicated upon capitalizing on each opportunity. We evaluate every deal as if our own money, reputation, and success is on the line because in reality, it is. You can rest assured knowing your business’s livelihood is in good hands. Our sole focus is ensuring our clients are positioned in the best location with the most favorable terms. Let us help you achieve the highest levels of success for your business and investment.




Question: What makes HFS different than other healthcare real estate brokers?


HFS is a leader in healthcare real estate brokerage and design.

We take great pride in helping dentists, physicians, physical therapists, and veterinarians improve the success of their practice.

Whether you are opening a new office or expanding your existing healthcare facility, HFS has the expertise you need to navigate the cumbersome process with a single source of accountability.

Our professional services include real estate brokerage, feasibility studies, space planning/test fits, architectural and interior design, design-build, and advisory services.

We represent the interest of every type of healthcare specialty and truly understand the nuances and unique design needs for your practice.

Our experts handle all the details and logistics using our proven process, allowing you the time you need to focus on what is most important, your practice!




Question: What if I'm thinking about using HFS to help me get out of a bad situation now?


HFS is focused on successful outcomes for our clients. This is exactly why you will want a qualified agent in your corner who cares about your practice. Our company’s focus is helping healthcare providers maximize every real estate opportunity. In doing so, we deliver the highest quality representation and results available.





Design-Build

Question: What makes a healthcare designer different from any other designer?


Answer: Architects and designers who have experience designing medical and dental offices know the specific requirements needed for healthcare facilities. Although every project is different, a specialized level of attention to detail is required. Failing to secure a designer without proper knowledge and expertise often results in costly pitfalls and oversights that not only delay a project but that also cause it to go over budget.




Question: Isn't any architectural designer qualified to design my healthcare office?


Answer: Most healthcare design requires specialized expertise and experience to ensure the facility will be compliant with healthcare code as well as flow and function at a high level. Once built, it is very difficult and costly to make changes to correct design flaws. Incorporating the proper details and specificity required for a healthcare project will also eliminate costly delays and budget overruns. At HFS, we only design healthcare facilities and have a proven process that factors in all the details to ensure your project will be a success.




Question: How do I know if the office I'm considering will be right for my practice?


Answer: It is critical to perform a test fit to verify that the size and configuration of the facility will accommodate your program. It is highly recommended to use a healthcare design expert to ensure the space is designed for maximum efficiency and functionality.




Question: What makes HFS different from other companies?


Answer: HFS is a leader in healthcare design. We have more than two decades of experience representing the interest of every type of healthcare facility and truly understand the nuances and unique design needs for your practice. Our experts handle all the details and logistics using our proven process. We can handle every aspect of your project from site selection to design and build-out of your facility. Healthcare is our passion. It is all we do!




Question: How much will my project cost?


Answer: There are a lot of variables that will determine the total cost of a project. We work very closely with every client to identify needs and goals to help create a budget. We then design the project to meet your budget and maximize the return on your investment. At HFS, we can offer guarantees on budgets and schedules with our design-build delivery.




Question: How long will it take to design and build my new office?


Answer: It will depend upon the size of the project and whether you are looking to renovate an existing facility or build from the ground up. At HFS, we have a proven process that will factor in all aspects of the project including real estate, design, and construction. We will create a detailed schedule that will clearly communicate timelines and activities required to successfully complete your project.




Question: What types of services do you offer?


Answer: HFS offers a wide range of professional services for the medical, dental, physical therapy, and veterinary industries. Our various services include site selection, feasibility studies, test-fits, architectural design, interior design, MEP engineering, design-build, green and sustainable solutions, and advisory services.