Buying vs. Leasing Office Space for Your Dental or Medical Practice
Finding the right office space is one of the most important business decisions you’ll make as a healthcare business owner and provider. Whether you’re launching a new dental or medical practice, relocating, or expanding, choosing between buying or leasing can impact your cash-flow, flexibility, and long-term goals.
At Franklin & Frankel LLC, we’ve helped dentists, doctors, and healthcare professionals throughout Connecticut and Massachusetts navigate the legal and business aspects of real estate decisions. Below, we break down the key pros and cons of buying versus leasing to help you make an informed, strategic choice.
Buying Practice Space
| Pros | Cons |
| Long-Term Investment
Build equity and potentially increase value. |
Higher Upfront Costs
Includes down payment, closing, and build-out. |
| Full Control
Freedom to renovate and customize. |
Less Flexibility
Relocating or selling can be costly and time-consuming. |
| Tax Advantages
May deduct mortgage interest and depreciation. |
Maintenance Responsibilities
You manage repairs and property upkeep. |
| Rental Income Potential
Option to lease space to others. |
Tenant Responsibilities
You manage the relationship with tenants. |
Leasing Practice Space
| Pros | Cons |
| Lower Initial Investment
Preserve capital for other expenses. |
No Equity; may still require buildout
Rent payments don’t build ownership. Also, you may still need to borrow or invest in a buildout. |
| Flexibility
Shorter lease terms make it easier to move or expand (but if you’re borrowing from a bank, the lease term typically tracks the loan term). |
Lease Renewal Risks
Landlord may increase rent at lease renewal or not renew lease. |
| Fewer Responsibilities
Landlord may handle maintenance, depending on your lease terms. |
Limited Customization
Renovation options may be restricted. |
| Access to Prime Locations
Ideal for high-traffic areas. |
Hidden Costs
Common area maintenance (CAM) fees and other clauses can increase costs. |
Bottom Line: Align Your Space with Your Strategy
There’s no one-size-fits-all answer. The right path depends on your practice’s goals, cash flow, and long-term plans. A startup dental practice in West Hartford might benefit from the flexibility of leasing, while a growing specialty clinic near Boston may find long-term value in owning their building. No matter your direction, working with an experienced attorney early on can help you avoid hidden pitfalls, negotiate stronger terms, and secure a deal that aligns with your business strategy.
The team at Franklin & Frankel have handled thousands of dental and medical real estate deals, contact us to learn more about the best route forward for your practice.