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Top 10 Factors For Doctors Looking for Medical Office Space

medical billing Top 10 Factors For Doctors Looking for Medical Office Space

Medical office buildings were all the rage in commercial real estate before the recession, were the only rage in commercial real estate during the recession, and remain all the rage after the recession. Why? Namely because of this country’s ever expanding healthcare needs.  We can also blame poor diet and exercise habits, a lack of reasonable healthcare reform, and skyrocketing healthcare costs. This means there is and will continue to be a need for practices all across the country, which provides stability for landlords.  In addition, due to the specialized nature of the requirements for doctors, landlords can typically charge higher rents as well. So what goes into a doctor’s decision making process when choosing medical office space?  Landlords……listen up.

This list, courtesy of the Orlando Medical News publication:

10. Mixed Use Development/Modern Architecture

Often, physicians are now looking for mixed use development featuring more modern architecture. They want buildings that are appealing and inviting. Unless it is a very small practice the old one story stucco flat roof office building is becoming a thing of the past.

9. Signage

Building monument or signage to distinguish your medical group or practice is an important feature. Local zoning laws often restrict the size and location of business signage in any given area, but often the developer can offer “top of building” signs for major anchor tenants.

8. Exclusivity

Willingness of the landlord to restrict leasing to other physicians of similar specialty in the same building is often requested. While many physicians view this as an important concession, it probably is not that important in the long run. After all, there is really nothing a physician group can do if a competitor wants to relocate across the street. This is probably more important in rural or less populated areas where a new hospital is being established.

7. Geographic Location

In the past, doctors needed to be close to the hospital to round on large numbers of inpatients and perform mostly inpatient surgeries. Now procedures are more frequently performed on an outpatient basis, and doctors can relocate their offices farther away from the hospital at usually lower lease rates. Many practices now have incorporated outpatient surgery facilities located at or nearby their office location.

6. Parking Ratio and Parking

Most professional office buildings have a parking ratio of two to three parking spaces per thousand square feet. With patients coming and going throughout the day, doctors need to have at least four to five parking spaces per thousand square feet to avoid overcrowding. Since parking can be tight in the downtown corridor, doctors often shy away from downtown medical space. Reserved parking is also a nice plus for key employees and physicians. Covered handicapped pick-up and drop-off areas are a real asset, especially if there are associated outpatient treatment facilities.

5. Shell Space vs. Used Space

Although shell space may cost more in the beginning, it will end up saving the doctor a lot of money in the long run. With new shell office space you can do space planning/ design work to fit your own needs and patient flow. This way you won’t waste square feet. Used office space with existing layouts often can’t be adapted without expensive demolitions and remodeling. While this can be accomplished, there still remains the potential for poorly laid out space that doesn’t fit the needs required.

4. Proximity to Other Physicians

In a medical office building, doctors are often looking for proximity to other physicians who could inter-refer to each other. For example, a family medicine physician will frequently refer patients to other medical specialties such as cardiology or orthopedics. With the right synergy, all of the doctors are inter-referring and enhancing their practices.

3. Ancillary Services

After interviewing several doctors, the new buzz word is “Ancillary Services.” Traditionally, hospitals were the main benefactor of many of these services. Ancillary services include MRI’s, sleep labs, physical therapists, outpatient surgery centers, and imaging centers. Doctors are more recently looking for extra medical office space where they can install ancillary services and other diagnostic treatment areas.

2. Accessibility

Doctors are looking for access to major road arteries and highways so their patients can find easily them. If a doctor’s office is tucked away somewhere in the middle of nowhere their patient may have a more difficult time finding them and have to go through a maze of side streets to find their office. After exiting the highway, doctors expect their patients to make less than two turns to find their offices. After all, as a patient they may not be feeling all that good in the first place. Why make their plight any more difficult if they can’t find their doctor?

1. Affordability

The number one factor affecting doctors’ decisions when deciding on medical office space is affordability. Say a large surgical practice signed a long term lease for 30,000 square feet in a new mixed use development project at $17 per-square-foot. This new leased space will also include an outpatient surgery center on the premises. Before signing this lease, this same practice was offered the same amount of medical space closer to a major hospital for $25 per-square-foot. Why pay $25 per-square-foot when you can go down the street and pay $17?

Reprint from Llenrock.com   by Dave Jacobs

Categories: Leasing
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