Frequently Asked Questions for Healthcare Buyers & Tenants
For those acting as a tenant or buyer, you should not pay for representation. The industry standard, for both residential and commercial real estate, is for the landlords and sellers to pay commissions to both their agent and the agent of the buyer or tenant.
So-called consultants, negotiators, and attorneys can try to take advantage of you, charging thousands of dollars to provide the services that a qualified healthcare real estate agent will handle at no cost to you with more effective results
The primary benefits of hiring an agent are:
- Avoiding costly snags, delays, and complications
- Saving hours of valuable time
- Ensuring your needs and interests are protected and always come first
- Saving a substantial amount of money
- Giving you the priceless peace of mind that you are in the best property, acheived at terms most favorable to you.
There is a significant difference between residential and commercial real estate. Even the best residential agents wouldn’t even think of completing a commercial real estate transaction, and the finest commercial agents won’t work with residential real estate. Each specialty has a distinct approach to the market, and commercial real estate has a vast number of additional economic and business considerations that simply don’t apply to residential real estate.
Residential agents can be expected to make value determinations based solely upon similar properties on the market. In contrast, a commercial agent factors in how concepts such as build out time, free rent period, tenant improvement allowance, annual escalations, and other options impact profitability. While residential agents primarily focus on personal likes, dislikes, and desires for a home, a commercial agent is data-driven using complex tools and sophisticated strategies to evaluate the best options for maximizing a business’ profitability and success.
There are experts in residential real estate, and there are experts in commercial real estate. When faced with an agent who claims to be an expert agent in both, continue on to find an agent who only specializes in one or the other.
Yes, absolutely you should hire an attorney in addition to your real estate agent. Lease and purchase contracts are legally binding documents. When looking for an attorney, your healthcare real estate agent should be able to assist with the names of several attorneys for you to interview, helping you to determine who can offer you the best price, protection, value, etc.
It is also essential that your chosen attorney specializes in commercial real estate, contract, and business law.
A real estate agent should not –and cannot– perform a legal review of your lease. Simply put, the legal implications of an agent offering legal services is enough to prohibit any agent from doing so. Even if it were legally allowed, there is plenty of reason to hire professionals backed by the education, training, and experience to advise you within their area of expertise. For that reason, ARC strongly recommends and encourages clients to hire a real estate-specific attorney for their transaction.
For a real estate agent to practice law would be a breach of both ethical and legal state statutes. Practicing law constitutes the giving of legal advice, including but not limited to the review and evaluation of a legal document (i.e. a lease) and then advising a client on the outcomes or strategies to move forward. Licensed attorneys are the only parties permitted to practice law and to give a client legal advice.
Additionally, a real estate agent is only permitted by law to populate blank fields on a pre-approved form contract. If an agent were to draft legal language within a document or contract, give legal advice, or perform any other action resembling practicing law, they not only put their client at risk but can become subject to serious consequences such as potential lawsuits, losing their license, jeopardizing the completion of the purchase, sale, or lease, subsequently doing permanent damage to their career and reputation.
You could save tens to hundreds of thousands of dollars by working with an expert in healthcare real estate. If your lease payment errs by even a small amount, it can sum up to a substantial loss of money over 10 years in unnecessary, higher payments. Moreover, if you do not receive the proper amount of free rent period, build out time, tenant improvement allowance, and more, you can leave the same amount of money on the table.
Thankfully, if you are properly represented, thoroughly understand your options and execute a plan that is catered just for your practice, you can save tens to hundreds of thousands of dollars and have the peace of mind that your interests were always first and secured.