Why Most Orthodontists Get Their Commercial Leases Wrong

Subscribe: RSS

 

Commercial real estate for dentists and orthodontists is one of the largest costs a practice carries, second only to payroll, and it is the one most owners handle with no expert help. On this GrowOrtho episode, host Luke Infinger sits down with Colin Carr, founder and CEO of CARR, a firm that represents healthcare providers on the tenant and buyer side of real estate deals in all 50 states and currently works with more than 6,000 clients.

Carr’s core argument is blunt. When a doctor shows up to a lease renewal or a purchase without representation, the landlord already knows it, and the doctor loses. Not a rounding error. On a normal 10-year lease, Carr puts the average loss around $300,000.

This post lays out where that money goes, why representation changes the math, and exactly when in the process a practice owner should pick up the phone.

Key takeaways

• More than 90% of doctors negotiate their real estate with no representation, according to Colin Carr, who spent nearly a decade on the landlord side before founding CARR.
• Lease renewals are the single transaction where healthcare providers lose the most money. The average practice leaves a couple hundred thousand dollars on the table at a typical renewal.
• On a standard 10-year lease for a 3,000-square-foot space, Carr estimates a practice negotiating alone leaves roughly $300,000 on the table.
• Only about 1 in 10 doctors buys their real estate. When they do, the real estate is worth more than the practice about 90% of the time, and Carr estimates it adds $1.5 million to $2 million in net worth over 20 years.
• The broker commission is already built into commercial real estate deals. A tenant who skips representation does not pocket that money, they forfeit the benefit, the same way an unused dental insurance premium is not refunded.
• Timing drives negotiating power. Start a renewal, relocation, or purchase 18 months out (12 months minimum), a ground-up build 18 to 24 months out, and a startup 9 to 12 months out.
• A landlord who sees an unrepresented doctor assumes limited market knowledge and stalls. Representation that has already collected competing offers flips that posture.

 

What does CARR do, and why only healthcare tenants and buyers?

CARR is a commercial real estate firm that represents only healthcare providers, and only on the tenant or buyer side of a deal. Colin Carr, the founder and CEO, does not take listings and does not work for landlords or property owners. His clients are dentists, orthodontists, physicians, veterinarians, and other providers. The firm is licensed in all 50 states and, as of this recording, represents more than 6,000 clients.

The reason for that double niche traces back to Carr’s earlier career. He spent close to a decade in commercial real estate, much of it on the landlord side, at one point holding around 1.5 million square feet of listings in the Denver suburbs. In retail, industrial, and office deals, he says, both sides almost always had representation. In medical deals, roughly 9 out of 10 doctors had none, and the rare doctor who did was often working with a residential agent or a friend of the family who had never done a commercial deal.

Carr founded the firm at the start of 2009 around a single mission he describes as helping people who help people, and leveling the playing field for providers who have never been taught how these negotiations actually work.

Why do more than 90% of doctors negotiate real estate with no representation?

More than 90% of doctors handle their commercial real estate deals with no representation, according to Carr, and that number comes from both sides of his career. As a landlord’s agent, he watched it play out deal after deal. As a tenant and buyer’s agent now, he sees the same pattern in the leases his new clients bring him: no broker on the last two, three, or four deals, or a broker who did not know how to push.

The turning point for Carr came from a handful of deals in a short window where he did exactly what his landlord clients instructed. The terms he was told to propose were, in his words, egregious, and the doctors signed them anyway. Doing quick math after the fact, he realized one doctor had lost around $400,000 and another around $600,000 compared to what a competent tenant’s agent could have secured through lower lease rates, larger buildout allowances, free rent, and lower annual increases. He decided he could have more impact on the other side of the table, went healthcare-only and tenant-and-buyer-only, and never looked back.

How much money do dental and orthodontic practices lose on a lease renewal?

The lease renewal is the transaction where practice owners lose the most money, and it is not close. Carr calls it the number one transaction for losing money in all of commercial real estate, across retail, office, and industrial, not just healthcare. Roughly 90% of doctors lease their space, so this is the deal most practice owners will face repeatedly over a career.

On an average renewal, Carr says the typical dentist or physician in a couple-thousand-square-foot space leaves a couple hundred thousand dollars on the table. On a standard 10-year lease for a 3,000-square-foot tenant, he puts the figure closer to $300,000. The reason the number is so high is that a lease cannot be altered once it is signed, and a renewal only comes around every five, seven, or ten years. As Carr frames it, you get one crack at it, and a shanked drive cannot be replayed with a second ball.

Is it better to lease or buy commercial real estate for a practice?

For the roughly 1 in 10 doctors who buy their real estate, ownership usually becomes the more valuable asset. Carr says that for practice owners who buy, the real estate is worth more than the practice itself about 90% of the time, and not by a small margin. His estimate is that buying commercial real estate for the practice increases an owner’s net worth by $1.5 million to $2 million over 20 years.

His larger point applies whether you lease or buy. A renewal, a startup lease, and a purchase all put a large amount of money on the line that can be won or lost, so the transaction deserves to be treated with the respect that size warrants rather than handled off the side of a desk.

A real example: how one dentist recovered more than $200,000 on a lease renewal

One case Carr shared makes the stakes concrete. He met with a dentist who was one of about five providers on the second floor of a medical building. The dentist had never had representation and had always done his own leases. Looking at the lease, Carr found no free rent and no buildout allowance, even though the space had not been touched in about 20 years, and the rate was above market.

When Carr asked why, the dentist explained that the four other providers on the floor all shared their terms with each other, so he assumed his deal was as good as anyone could get. Carr pointed out the flaw: every doctor he was comparing against was also unrepresented, so they were all measuring “fair” against each other while trusting whatever the landlord told them. Carr had just signed a brand-new dentist on the first floor of the same building at roughly $8 to $9 per square foot less, with six months to build out, five months of free rent after opening, and a large renovation allowance.

Using that fresh comparable, Carr renegotiated the second-floor dentist’s renewal. He cut the lease rate by about 30%, secured renovation money and free rent, and swung the deal in the dentist’s favor by a couple hundred thousand dollars. He compares the old approach to a patient asking another patient for a diagnosis instead of seeing the doctor. It sounds absurd, and people are doing it on multimillion-dollar contracts.

Why landlords assume an unrepresented doctor is an easy target

Sophisticated landlords expect every serious tenant to have representation, so a doctor who shows up alone signals inexperience before the negotiation even starts. Carr’s point is that no major tenant negotiates without a broker. Chipotle, Starbucks, and Chase Bank all have internal real estate teams plus outside brokers. So do office tenants like Lockheed Martin and Charles Schwab. When an institutional landlord sees a provider who will do only two, three, or four real estate transactions in an entire career and has no broker, the landlord assumes that person cannot level the playing field.

From there, Carr says, landlords lean on predictable tactics. They know most doctors avoid confrontation, while landlords deal in it daily. They run out the clock. They say things like “our lender won’t allow that.” If the doctor concedes even part of it, the landlord has the upper hand. This is why an unrepresented doctor rarely gets even a fraction of the terms a represented one would.

Can you DIY a commercial lease with ChatGPT or an attorney friend?

Carr’s answer is that AI and a general attorney can inform you, but they cannot represent you, and trying to DIY the negotiation usually backfires. He grants that tools like ChatGPT or Gemini are useful for learning what to expect. The problem is that neither is an expert healthcare real estate attorney, and landlords can tell instantly when lease comments came from someone doing family law in Iowa rather than a commercial specialist. Asking for terms that are not market makes the landlord take the tenant less seriously and can cost movement on the points that were actually winnable.

There are two ideas here worth holding onto. First, “it never hurts to ask” is false in a negotiation; asking for absurd terms damages the relationship and shrinks what the other side is willing to give. Second, the broker commission is already set aside in every commercial deal. Carr compares it to dental insurance: you pay the premium whether or not you use the benefit, and if you never see the dentist, the insurer keeps the money rather than refunding you. Skip representation and you do not save the commission, you just forfeit the benefit, lose 30 to 50 hours of your time, and end up with a result you cannot undo for another five to ten years.

When should a dental or orthodontic practice start the real estate conversation?

The single biggest lever a practice owner controls is timing, because a landlord who knows you are out of time knows you cannot walk. Carr breaks the timeline down by scenario.

For a startup, begin right away. The process runs a minimum of 9 to 12 months and often longer, so start the conversation even before you finish residency and you can build the ideal timeline.

For an acquisition, start before you have even identified the practice, so the lease can be reviewed quickly when you find one. Carr warns against trusting the practice broker’s read on the lease, since that broker has a fiduciary duty to the seller, not to you. A comment that the previous doctor “wouldn’t have signed it if it wasn’t fair” means nothing, because that doctor was likely unrepresented too.

For scaling to multiple locations, start as soon as you think you want to scale.

For a ground-up build where you buy land and construct your own building, the conversation has to begin about two years out. Carr estimates a solid 18 to 24 months for that process, unlike a residential build in a master-planned community.

For a lease renewal, a relocation, or buying an existing building, start ideally 18 months out, with 12 months as the absolute minimum. Here is why the runway matters. If your lease is up in three months and you only then approach the landlord, they know you cannot relocate in time, so they run out the clock and give you nothing reasonable until you are forced into their deal. Carr compares it to a football team running out the clock with a lead. Start 12 to 18 months out with a broker who has already gone to market, gathered best-and-final terms from multiple landlords and sellers, and knows exactly what a market deal looks like, and the posture flips. You are no longer at the landlord’s mercy; you are telling them the terms it will take to keep you.

He adds a point Luke Infinger reinforced: even if representation saved you nothing, the time is worth it. The hours a busy owner would burn negotiating could be spent seeing 25, 50, or 100-plus patients.

Get your lease reviewed before you sign

If your practice is facing a lease renewal, a relocation, a purchase, or a startup buildout, the time to get represented is before you are out of runway. Watch or listen to the full GrowOrtho episode with Colin Carr, and if you want to know how your current lease compares to the market, CARR offers a free lease or purchase evaluation and can match you with a healthcare-specialized agent at carr.us.

FAQ

When should a dental practice contact a commercial real estate broker? Right away for a startup (a 9 to 12 month process minimum) or an acquisition. For a lease renewal, relocation, or purchase of an existing building, start 18 months out, with 12 months as the minimum. For a ground-up build, start about two years out.

How much do doctors typically lose on a lease renewal? Carr says the average practice leaves a couple hundred thousand dollars on the table at a typical renewal, and closer to $300,000 on a standard 10-year lease for a 3,000-square-foot space. Lease renewals are the number one transaction for losing money in all of commercial real estate.

Is it better to lease or buy commercial real estate for a practice? About 1 in 10 doctors buys, and Carr says the real estate ends up worth more than the practice about 90% of the time, adding an estimated $1.5 million to $2 million in net worth over 20 years. Both leasing and buying put large money on the line, so both deserve real representation.

Can I just use ChatGPT or my attorney to review a commercial lease? They can help you understand the process, but they cannot represent you in the negotiation. A general attorney is not a healthcare real estate specialist, and landlords can spot non-market requests immediately, which weakens your position on the points you could have won.

Does hiring a tenant broker cost the practice extra? No. Carr says the commission is already built into commercial real estate transactions. If you do not use representation, you do not get that money back, you simply lose the benefit it was meant to pay for.

Glossary

Tenant (or buyer) representation: A broker who works exclusively for the tenant or buyer in a deal, not the landlord or seller.

Buildout / tenant improvement (TI) allowance: Money a landlord contributes toward constructing or renovating the tenant’s space.

Free rent (rent abatement): A period, often during buildout or shortly after opening, when the tenant pays no rent.

Base year: The reference year used to calculate certain operating-expense pass-throughs in a lease; resetting it on a renewal can lower a tenant’s costs.

Lease renewal: Extending an existing lease with the current landlord, and the transaction where Carr says practices most often overpay.

Notice to vacate: Formal notice that a tenant intends to leave, which can shift negotiating power in a renewal.

Fiduciary duty: A legal obligation to act in one party’s best interest. A practice broker owes this to the seller, which is why their read on a lease is not neutral.

Episode Summary

Title: Why Most Orthodontists Get Their Commercial Leases Wrong
Show: GrowOrtho Podcast,
Host: Luke Infinger (founder and CEO, HIP Creative)
Guest: Colin Carr, founder and CEO of CARR (carr.us), a commercial real estate firm that represents healthcare tenants and buyers in all 50 states
Published: [08-31-2026] | Last updated: [08-31-2026]

Summary: More than 90% of dentists and orthodontists negotiate their office real estate with no representation, and it costs them. Colin Carr explains that lease renewals are the single transaction where healthcare providers lose the most money, with the average practice leaving a couple hundred thousand dollars on the table, and roughly $300,000 on a standard 10-year lease for a 3,000-square-foot space. He walks through why savvy landlords treat an unrepresented doctor as an easy target, why ChatGPT and a family-law attorney friend cannot substitute for a healthcare-specialized broker, and why the broker commission is already built into every deal whether the tenant uses it or not. The episode closes with clear timing: start a renewal, relocation, or purchase conversation 18 months out, a ground-up build 18 to 24 months out, and a startup 9 to 12 months out.

Topics covered: lease renewals, tenant and buyer representation, buildout allowances, free rent, lease vs. purchase, practice startups and acquisitions, ground-up construction timing, landlord negotiation tactics.

Key entities: CARR (Carr Healthcare Realty), Colin Carr, Luke Infinger, HIP Creative, GrowOrtho, ChatGPT, Gemini.

About the author

By Luke Infinger, CEO and Co-Founder, HIP Creative | Author

Luke Infinger has spent more than 12 years helping dental and orthodontic practices grow through marketing, software, and education. He is the founder of HIP Creative, which works with more than 500 dental and specialty practices across the country, and the creator of Practice Beacon, a lead-tracking CRM built specifically for dental and orthodontic teams. His work has included taking practices from regional obscurity to nationally recognized growth benchmarks, among them helping an orthodontist become the fastest-growing in the country by 2018. He is also the author of multiple books on practice growth and a sought-after speaker for dental continuing education events. LinkedIn: https://www.linkedin.com/in/luke-infinger-b36a001b/

Full episode transcript

[00:00] Introduction

Luke: Colin, thanks so much for coming on the GrowOrtho podcast.

Colin Carr: Thanks for having me, I appreciate it.

Luke: Absolutely. For those watching or listening, tell them a little about you and your company.

Colin Carr: Our company is called CARR, maybe very uninspired because it’s my last name. It was originally Carr Healthcare Realty, and everyone just dropped the Healthcare Realty, so we dropped it as well. We’re a commercial real estate firm that exclusively represents healthcare providers with their real estate, and we only work on the tenant or buyer side of the transaction. No listings, no landlord or owner work, just tenant and buyer work. Our only clients are doctors: physicians, dentists, veterinarians, and so on. Our entire mission is to level the playing field for healthcare providers with their real estate. We’re licensed in all 50 states, we serve thousands of clients per year, and our mission is to help people that help people.

Luke: Love that. It’s funny you named your company that, when that’s what most private practices do, right? Doctor’s name.

Colin Carr: It works.

Luke: We named our company HIP Creative 12 years ago and basically dropped the Creative. Everybody just says HIP. Walk me through the origin story. How’d you get into this?

Colin Carr: I’ll give you the short version. The company was the result of me working on the landlord side of a number of medical transactions where I was the listing agent. The landlord was super savvy, hundreds of millions of dollars of medical assets, so they were the consummate professional when it came to negotiating and running properties. I’d been doing real estate for a long time, mostly landlord work. On a retail deal, both parties had representation. Industrial, both parties had representation. Same for office. Then I started doing medical deals and realized that literally 9 out of 10 doctors had no representation when we transacted.

The 1 out of 10 that did have representation, it was a friend or a family member or a patient who was really a residential real estate broker with no clue about commercial. You could tell within seconds of talking to them. I had a number of deals in a short period where the landlord told me what to propose, the terms were egregious or predatory, and I did what I was told because it’s my legal obligation. The doctor just signed off on these lease renewals or new office deals. I remember looking at what we accomplished for the landlord, how much more the doctors paid, and how little they received. I did some quick napkin math and thought, that doctor just lost $400,000, that doctor just lost $600,000. If I’d been on the other side of the table, I could have gotten them another half million in lower lease rates, higher buildout allowances, free rent, lower annual increases, resetting base years on renewals.

So at the end of 2008, beginning of 2009, I decided to go healthcare only and tenant and buyer rep only. I picked up a couple of healthcare deals on the tenant side and completely flipped the script. Doctors who had been getting destroyed in negotiations, I got brought in and turned the tables by $300,000, $400,000, $500,000 in a short period. After that I said, this is the greatest impact I’ve ever had in real estate. For every landlord listing, there are 10, 15, 20 brokers who’d take it in a second. On the doctor side, for some reason, no one was representing them. So I started the company at the beginning of 2009, and today we’re licensed and operate in all 50 states. As of this recording, we have over 6,000 clients we’re representing right now.

[04:07] The 30-second pitch to a doctor

Luke: If you had only 30 seconds to make your point to a doctor, what would you say?

Colin Carr: About 90% of doctors lease their office space. The number one transaction where doctors lose money is on lease renewals. It’s the number one transaction in all of commercial real estate, not just medical but retail, office, and industrial. People get a lease, it comes up in five, seven, or ten years, and the average doctor will leave a couple hundred thousand dollars on the table during an average renewal. I know that sounds high, but I’ve done thousands of deals personally. The average dentist or physician in a couple-thousand-foot space will leave a couple hundred thousand dollars on the table.

Here’s my second 30-second commercial. For the maybe 1 out of 10 doctors who buys commercial real estate, that real estate will be worth more than the practice 90% of the time, and not by a little. Most doctors who buy increase their net worth by $1.5 million to $2 million over 20 years. So whether you’re renewing a lease, buying real estate, or getting a lease for a startup, there’s a lot of money on the line that can be won or lost. Treat the transaction with the respect it deserves.

[05:21] A deal turned around

Luke: Share a story where things were going the wrong way and you came in, saved the deal, and added value.

Colin Carr: We meet with a dentist who is one of five doctors on the second floor of a medical building. We’re looking at his lease, the master lease plus his last two or three five-year amendments. We ask if he’s ever had representation. He says no, he’s always done his own leases. I said, I’m looking at the lease and I don’t see any free rent on your last renewal. He said he didn’t get any. I asked about buildout or renovation allowance, because his space was tired, and he admitted they hadn’t done any work in about 20 years. No allowance there either.

I asked why. Why no free rent, no tenant improvement allowance, and why was he paying that lease rate, which was not market? He said there were four other doctors on the floor, they all talk, they share terms, and they all have the same deal, so he figured it was the best he could get. I said, so you’re gauging a fair, market deal by what four other unrepresented doctors received, when you’re also not represented, and really you’re just hoping what the landlord told you is true. I told him I’d just signed a brand-new dentist on the first floor whose buildout hadn’t started yet, so he didn’t know about it. That doctor was $8 or $9 a square foot less than what he was paying. We got them six months to build out, five months free upon opening, and a huge renovation allowance.

I said, if you got even a fraction of that, half the TI allowance, half the rent reduction, that’s $400,000 or $500,000 you’ve lost over the last three or four deals. That landlord knows I know the market better than anyone, and that you’re now educated, so you won’t accept that kind of deal moving forward. We went in and cut his lease rate by about 30%, got him money to renovate and a bunch of free rent, and swung it in his favor by a couple hundred thousand dollars. Then I talked to the other four doctors on that floor too. That scenario of a patient just talking to another patient about a medical issue, take my word for it rather than seeing the doctor, when you hear it like that it’s the dumbest approach. That’s exactly what people are doing on multimillion-dollar contracts.

[08:30] How many doctors go unrepresented

Luke: What percentage of doctors do a deal with no representation?

Colin Carr: Well over 90%. We have thousands of clients and have barely scratched the surface. I know that because I was on the landlord side for a long time. I had a million and a half square feet of listings when I stopped doing landlord work, even in one city, in the Denver suburbs. I knew the market really well. For every one doctor who had a broker, nine did not. We’ve proven this out many times. We’ll do a deal for a doctor, look at their lease, and they didn’t have a broker on the last three or four deals, or if they did, the broker often didn’t know what they were doing. They made a call on a property, the broker said “I don’t have anything here but I can help you on your next one,” and that’s a landlord broker trying to be a tenant broker who just wants to get a deal done. They won’t push even a fraction as hard as they could. Even when doctors have representation, it’s very rarely good representation.

[09:34] Business owners and the DIY instinct

Luke: How old are you? You look super young.

Colin Carr: I’m 45.

Luke: I’m 39, and I’d say you look my age. Congrats, that’s a lot of success in a short time. Let’s unpack some of that, because I feel very similar with marketing. Business owners want to DIY it, and hypothetically that’s great, but it can cost a lot of money and time. When you say you can save people hundreds of thousands of dollars, what are some of the things they don’t know to look for?

Colin Carr: Landlords, especially institutional or savvy ones, know that no legitimate tenant or buyer goes without representation. Take the top 200 or 300 retailers. Not one goes to market without a broker. Chipotle, Starbucks, Chase Bank, pick any retailer, they all have an internal real estate team and an external broker. Same with office. Lockheed Martin, Charles Schwab, any tech company, there’s no scenario where they don’t have both. So when a savvy landlord sees a doctor show up who will do two, three, or four transactions in an entire career with no broker, they instantly assume this person has no clue. It doesn’t matter how many times they ask ChatGPT or Gemini a question. There’s no way to level the playing field showing up without a broker. The landlord knows the doctor has no time, no expertise, hasn’t researched competing properties, and won’t go negotiate with three or four landlords simultaneously the way top companies do.

Then there are the little things they pick up on. Most doctors don’t want confrontation. Landlords deal in it. They know if they make it uncomfortable, run out the clock, say “we can’t do this” or “our lender won’t allow it,” and the doctor bites off on even part of that, they’ve got them.

[12:45] Why DIY costs more than it saves

Colin Carr: DIY looks a lot of ways. I can pull my own teeth. I can grab pliers and push a tooth out. You can build your own deck. The irony of commercial real estate is that there’s already a commission set aside in every transaction for the doctor to have a broker. It’s like dental insurance. You pay a premium every month for a benefit you can use during the year. If you don’t go see the dentist, the insurance company doesn’t refund your premiums. They keep it and thank you for not using your benefit. Same thing in commercial real estate. Take the DIY route and you’ll waste 30, 40, 50 hours, get frustrated, and figure out how much you lost a year later when we do a lease analysis and show you what you should have gotten. You lose time, you lose money, and you cannot undo that result. You get one crack at this every five or ten years. You can’t carry two balls to the tee box and, when you shank the first drive into the woods, pull out another and hit again. You mess up, it costs you a couple hundred thousand.

Luke: There’s a parallel with M&A deals, DSOs and OSOs. If you don’t have someone helping you, imagine all the paperwork and legal terms. You can take that to ChatGPT and it can misguide you or give you wrong information. You think it’s brilliant because it’s flagging all this stuff, then your attorney says none of it is accurate. I think it’s not just doctors, it’s small business owners as a whole who want to DIY to save money. Years ago my wife and I were budgeting, listening to Dave Ramsey, and I bought a cheap car. I ended up spending more fixing it than I would have on a newer car with a warranty. When I finally bought a small Lexus with free service and roadside assistance, I saved money. We tell ourselves we can DIY, and doctors are so competent from years of school that it feels like it should transfer, but that’s not the real world.

Colin Carr: I agree. AI or the internet is great for “how do I jump my car battery.” When it comes to an 80-page lease, none of these tools are expert real estate attorneys, and you’ll ask for things you shouldn’t. Landlords know when comments on a lease didn’t come from a real estate attorney, they came from a guy who does family law in Iowa while you’re in LA. People say “it never hurts to ask.” I can think of a hundred questions that will hurt you quite a bit. You’ll look uninformed, damage the relationship, and put yourself in a vulnerable position. If I’m selling my house for a million and you offer $400,000, that doesn’t build respect. Same with attorneys on leases. Ask for ridiculous things and they’ll say no on everything, or give you two token points instead of the ten or twelve points of movement you could have gotten. When you educate a doctor and say you can do this yourself, but if you make a mistake and leave money on the table, would it still be worth it if it were only $50,000, they say of course. The reality is it’s probably $300,000 on a standard 10-year lease for a 3,000-foot tenant. This isn’t overpaying at the grocery store. It’s a lease you can’t alter once it’s signed, and you get one crack every five, seven, or ten years.

[18:49] Why timing matters and when to reach out

Luke: Even if you don’t save money, there’s the time. How much is your time worth? In the hours you’d spend negotiating one deal, you could see 25, 50, 100 patients. A lot of business owners don’t value their time like they should. So when should a doctor contact you? You have startups, people going multi-location. Break that down.

Colin Carr: If you’re starting up, start talking right away, because that process takes a minimum of 9 to 12 months or longer. Start the conversation even if you’re six months from finishing residency, and we can lay out the ideal timeline. For an acquisition, as soon as you have a property or practice you’re interested in, the lease has to get reviewed very quickly, so starting before you find it makes sense. And 99% of people buying a practice will ask the practice broker, who has a fiduciary duty to the seller, whether the lease is good. They’ll hear “this is a fair lease, Dr. So-and-so wouldn’t have signed it otherwise.” That means nothing. That doctor probably had no clue about representation, signed it eight years ago, and left it. It’s the lease they have, so they’ll tell you it’s good. So startup right away, acquisition right away, scaling right away.

If you want to buy a piece of ground and build your own building, that conversation has to happen two years in advance. It’s not like a master-planned residential community with pre-approved floor plans you can build in six months. Your own building is a solid 18 to 24 month process. If you’re in a current lease and want to build, start that conversation two years out. Wait until your lease is up in six months and you’ve run out of time.

If you don’t want to build and you either want to renew, buy an existing building, or relocate, those three, start the process ideally around 18 months out. Twelve months is the absolute minimum. Here’s why. If your lease is up in three months and you start the conversation with your landlord, they know you can’t relocate the practice. They’ll say this person was asleep at the wheel and punish them for waiting too long. It’s like a football team running out the clock with a lead. Don’t give the other team the ball. If a landlord knows a doctor has three months left, they’ll give them nothing reasonable until forced. Start the process 12 months out with an expert broker who contacts the landlord and says, before I called you, I’ve been working with this doctor, we’ve gone to market, we have all the purchase and relocation options, and we have best-and-final terms from multiple landlords or sellers. We know exactly what a market deal looks like. If you’d like to entertain a renewal, here are the terms it would take to keep this doctor. We’re not asking for an offer as if we don’t know the market. We’re telling you what the terms need to be. That posture speaks differently than “you’ve got three months left, send me an offer.” It’s a strategy. I respect you, I’m not going to be a jerk, I’m not trying to bankrupt you, but you’ll have to bring a fair deal, and if it doesn’t work, I’ll move the practice or buy another building and you can re-lease my space.

[23:51] How to reach CARR

Luke: If a private practice owner watching or listening wants to get ahold of you, what’s the best way?

Colin Carr: The best way is our website, CARR.US. You can click to find an agent in your city or market, send a submission, and we’ll match you with the right person. If you want to get educated, we have a ton of resources and content on commercial real estate, not to teach you how to do it yourself, but to tell you what’s going to happen so you have more confidence in the process, similar to how a provider has articles or videos on what to expect with Invisalign or a hip replacement. We also do a lease analysis and a purchase-versus-lease analysis as part of the process once you talk to an agent. It helps direct you on what to expect and the direction you’re probably going.

Luke: Amazing. Thanks for coming on the podcast, I appreciate it.

Colin Carr: Thanks for having me.