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Dentists, Puns, and Money is a podcast focused on two things: The financial topics relevant to dentists leaving clinical practice and the stories and lessons of dentists who have already done so.
1. The stories of dentists who have transitioned from full-time clinical dentistry.
2. The financial topics that are relevant for dentists making that transition.
If you’re a dentist thinking about your exit from clinical, and you’d like to learn from the experiences of other dentists who have made that transition, be sure to subscribe to your favorite podcast app.
Host Shawn Terrell also dives deep into the many financial components of exiting dentistry, including tax reduction strategies and how to live off your assets.
And, we try to keep it light by mixing in a bad joke… or two.
Please note: Dentists, Puns, and Money was previously known as The Practice Growth Podcast until March 2022.
Welcome to dentists, puns and money. I am your host Shawn Terrell and my guest on today's episode is Colin Carr. Colin is the CEO and founder of Carr healthcare Realty and his company works with hundreds of dentists all over the US assisting both tenants and buyers with their dental practice real estate. In our conversation we discussed the many provisions dentists should ask for when renewing the lease on their practice face, including the specific language they should have in the assignability clause. We also discussed the important steps and considerations for dentists who owns their practice real estate and what they should be doing well in advance of a practice sale. As a reminder, our company dentist Exit Planning helps dentists leaving clinical with the personal financial planning piece of that transition, specifically, how to reduce that massive lifetime tax bill and also how to optimize living off of your assets. If you are interested in guidance on your taxes and your income as you as a clinical you can schedule an initial consultation with us on our website, which is dentists exit.com, our website again, dentists exit.com, and with that, introduction, I hope you enjoy my conversation with Colin Carr.
All right, Colin Carr Welcome to Dentists, Puns, and money. I am excited to hear your story. And thank you for joining us today. Thanks for having me on. I appreciate it. Please I always like to start is just to give the audience a little bit background about our guests. And so for you let's start with a little bit of your story can you share and where you've been and what brought you to this current point of your career? Yeah, absolutely. So I grew up in northern Michigan, so lower peninsula but northern Lower Peninsula, really cool resort town called Charleroi. And when I got to the point of trying to decide what I wanted to study in college, I could not make that decision. So I did the proverbial I'll take a semester off and then I'll research and figure it out. During that time I met a gentleman that was heavily involved in commercial real estate, mostly multifamily, and I start working for him and I got hooked on real estate. So I've been doing real estate since I was like late 18, early 19 years old, and I did mostly property management for the first three, four years. I moved to Colorado my early 20s got into brokerage and I started doing mostly large national retailers that point I was doing work for Walmart Wendy's blockbuster, people like that switch to focusing on more often industrial few years into my career and story short is I got asked to list a medical office building. I really enjoyed working with a doctor so I started going after more healthcare more with more medical and I became a full medical real estate broker. I was mostly on the landlord side though, and for a short time I had a number of transactions that I was involved with their healthcare providers. We're doing transactions without representation and they're just trying to figure out how to do deals or how to sign contracts at a number of transactions where where I launched I wasn't allowed to side with the landlord's the doctors were by themselves at DMC on one deal plastic surgeon on one deal a dentist on one deal. Use these doctors just got completely manhandled these transactions, and they had no clue they had no idea they were paying 10s of $1,000 more per year rent than they're supposed to. They were missing a very significant concessions they should have achieved or they could have achieved if they were properly represented their least did not have the terminology we're supposed to have. If they want to sell their practice there was all these things these guys were missing. For me just the light bulb went on. And I realized that the doctors needed a significant amount of help and that it was very much an unlevel playing field like they were at a huge disadvantage. The ladders honestly were gonna tell them that they weren't gonna say hey, by the way, go higher representation. They were glad handing down they were telling them things like if you don't use an agent will give you a better deal and making all these statements that were not true. And so, the 2009 I made the decision to go all in with a model to healthcare only kind of some buyers and so I launched our company car in early 2009. And today we now operate nationwide we represent 1000s of clients per year and we're coast to coast interesting story and someone that can relate to going all in and niching down on a specific target market. So are you guys you guys are healthcare right? Not just dental specific but dental makes up a significant portion of your business I assume. Yeah. So we are we are healthcare only we do a cmp amount of down so I think like you were founded in Colorado, I want to say we've done over 900 Dental deals in Colorado over the last 1415 years. Yeah, we're nationwide. We do all healthcare but ESRI has a huge portion of our world. So this podcast has become more and more focused on dentists that are transitioning out of clinical. So theoretically a dentist that either owns or leases their real estate where their practice is based. So kind of with that as a backdrop, what are a few of the key items that a dentist who is starting to think about transitioning out of clinical sometime in the next few years can start thinking about from a real estate perspective, that's really broad, and we can compare off from there. But I just want to start with the big ticket items that you think a dentist in that scenario should be thinking about. It's a great it's a great question. I mean, obviously even on that one is real estate is gonna play a major impact or major Wall in any transaction. Now, there's certainly going to be certain dances that decide to simply sell their charts or sell their goodwill to maybe a competitor or a large national group, and maybe they're gonna close down that location. And so in that scenario, real estate might not have as much of an impact on their timing the transaction property as far as getting out of the lease and having a lease expires where you can sell your church sell your goodwill and close it down. That's one aspect but let's assume that's not the case. Let's assume that the person who purchases your practice is gonna wanna continue that location. If you lease your space, there's a lot of things that we need to be paying attention to, you know, number one, when is your lease expiring? And then here's a couple of variables and Shawn, feel free to jump in at any of these in combat because I can go along with any of these but if you leave something out for recreation, a lot of healthcare providers will say, Well, I'm gonna let the new person deal with it. That might not be the best that might not be the best. decision for your practice. For instance, here's why not at least coming up for expiration, you could you could wait till you find the buyer Yes, or you could renegotiate your lease and if you renegotiate your lease, and you're able to achieve more competitive lease term that's gonna increase your profitability and increase the value of your practice because your practice a portion of is gonna sell on goodwill and it'll be based upon your your net revenue, your profitability. So if we could renegotiate your lease, and you could obtain a lower lease, right, that's going to make your practice more profitable, and hopefully will help your practice to sell faster. Certainly, when you renew a lease, you typically can get significant concessions from landlords or renovate your space. So if we're gonna be selling your practice, again, you can wait for the buyer to do it. But if you have the chance for me to go get yourself a p&l or lease rate, and then also obtain concessions like tenant allowance or remodel allowance. You can put in new flooring, you can repaint your space, you can even put in new cabinets and countertops and transaction counter. You might upgrade the lights, you might upgrade the blinds and you could do things aesthetically that make your practice appear more desirably and give it a better feel. And that's important as well. And then there's also things you can still do with the business terminology. People say well, I don't want to renegotiate the lease because I'm gonna get off lease that's no problem that the landlord understands. If you sell a practice, that's gonna be a priority to you. Here's the question, are you going to have the ability to achieve more favorable terms in a lease renewal, established dentist who's been there for you know, 1015 20 years or longer with your financials? Or is the new dentist who is just getting started or is younger their 10 year career who doesn't have your financial strength? Are they going to go negotiate better terms? The answer is you're going to be able to so you get you can typically achieve more favorable terms as the dentist renewing. If you've been in the space with lease rates 10 approved allowance you can also get for concepts like free rent, you might you'll get three or four months of free rent on renewal, which also will help improve your profitability or to put more money in your pocket. And then on the business side of it.
You can still negotiate outside of the closet space and if you sell your practice you're removed as a guarantor and that the landlord agrees to accept the new tenant who purchases your practice. Now, the whole lot we can talk about that assign ability clause, it's very important so we'll leave it as a placeholder but if you're gonna be selling your practice a lot of assets let's just wait till the new person shows up. That's one way to look at it. And that might be the best decision but a lot of times you can capture a lower lease rates, more concessions, more profitable terms if you do it yourself and you can actually make your transition smoother in the future by teeing up a clause that saved the landlord will accept the new title before they even show up based upon certain criteria. So a lot of interesting things in there and the light bulb went off figuratively over my head a couple of times. This was some things that you said, you know, we're living in this time as we record this in 2023, where anything that you buy, like fake real estate out of it, nothing seems cheaper now than it did a few years ago. But what if I heard you correctly? It sounds like someone that's been in a commercial space, a dental practice has been in the commercial space that has had a lease already. When that lease is up for renewal there is an opportunity there a good opportunity for a dentist owner to renegotiate that lease in in terms that are more favorable maybe than the last lease that they had. Did I hear that correctly? And if so, can you kind of expand on that you talked about some improvements and you also talked about rent or a lower lease per month and maybe they had been the case in the past? Yeah. So even with the inflation that we've experienced, which, you know, if you've been paying attention, the economy is you know, 40 plus year high, even with some like crazy things happening supply chain leases today still have an annual increase and then that outpaces the human inflation lever. And so yes, we've experienced the last two years levels inflation, but if you look at most leases that have an annual increase, which is 99 of 100 leases we're gonna have an annual increase those annual increases outpace inflation over over a five or 10 year period. So when you get to the end of the lease term, whether it's 2023, or whether you'd like three or four years, the lease rate that the dentist is paying is typically higher than they are marketing vacancies, that if there's vacancies for is higher than they would be marketing your space that if you were to vacate landlords want to make you believe that the annual increase is the current lease rate. And if you've had nine increases over a 10 year period, whatever you're paying a steel fair, it's very rarely the case. Typically, you're above market. And typically, if you handle the lease renewal properly, was a competitive strategy with a posture you can get the landlord to reduce your lease rate to a current market value. Additionally, when you're doing a lease renewal, I'm trying to get you to believe that they don't do concessions like free rent or tenant proven allowance or renovation allowances on renewals, but that's not true. If you were Charles Schwab and you're Lockheed Martin in an office as if you were Starbucks or Chipotle in a retail space. Anytime those tenants renew their leases, landlords are contributing to the deal. They're giving them market lease rates, giving them free rent packages, there's build up to give them building allowances. We're giving them credit for them allowances, and they're contributing to the deal because those landlords know these tenants move out of the space and allow others to give the next tenant the same concessions and typically in the tune of like two or three times that amount of money. So if you have a lease renewal coming up, you should be expecting a lower lease rate in the majority scenario. Now key words majority of our time or maybe not the case, but more times than not I say eight or nine times out of 10 year lease rates should be going down not up eight or nine times out of 10 You should be achieving prevent packages from allowances etc. Now again, if you still ask your landlord, will you do this? The answer is gonna be no. And if you ask your mandible to do this, we're going to already understand that you have no clue what you're doing. So you don't just ask them well, you have a strategy, I think a posture you have to approach the transaction the way that a sophisticated tenant, a large retailer, a large national company, fortune 500 companies, how do they approach the real estate if you approach it the same way you will capture those concessions and those concessions are worth a lot of money. It's typically worth a minimum of $1,000 and honestly for an average rental space being let's say, two 3000 square feet, it's definitely worth $120,000 either in your favor, or in the landlord's favor. Those are big numbers. Is it something that's a relatively new development or a cyclical development with commercial real estate post pandemic and more people working from home like I'm getting really high level broad here. Is that a huge assumption or is this something that's sort of always been there that maybe just people haven't known existed or known to ask for? always been there? It's been there. Well, it's been over the last several decades put it that way. I don't I can't speak to what's happening 4050 years ago for dentistry, but I've been a commercial estate for over 20 years now. And it's always been there. So again, the idea is and this is not meant to be a shadow dentist, no one's talking about your your clinical skills or your ability for Ron and staff of practice to do a great job leading the practice. We're talking to commercial real estate if you take our most active approach commercial real estate, and you compare that to how how does Whole Foods could approach their commercial real estate again, pick a company that you respect nationally, I don't care if it's a grocery store. I don't care if the fast food restaurant, how does how does Chipotle approach their real estate they have 1000s of locations they lease the vast majority of how do they approach their real estate? I know how they approach it, how they approach it is dramatically different in how most dentists approach it. And the only difference is the mindset of a tenant Chipotle says Listen, we're not gonna be taking advantage of we're not gonna pay above market lease rate and we know about market these rates look like because we've been in the market and we have three or four other properties do you have ready to go if you don't cooperate with those mister missus landlord. We got three other properties we've already negotiated with and we know we can attain or achieve other properties. You don't give us a free rent package. If you don't give us a kind of grim allowance. And we vacate the space we know for a fact you're gonna give the next tenant a tenant room allowance, maybe the next no free rent package. So we're not asking for anything that you wouldn't give someone else. Likewise, we're not willing to accept significantly lower concessions or higher lease rates that someone else would receive as well as the tenant. I'm trying to hurt the lender to put them out of business or hopefully have them to foreclose because the deal is so egregious. They're just saying listen, I need you to treat me the way you treat a brand new tenant, and I need you to treat me the way you treat a sophisticated tenant that's not gonna get taken advantage of and that's the difference in mindset or in preparation going into a deal between an individual dentist and a large successful Corporation. I think it just gets to the higher point that and this is again, I want to reiterate the point that you you've made as well. This is no shot at Dennis. I'm often sympathetic to dentists, owners and all the things that they have to keep track of and be good at how in the world could they expert on commercial real estate and renegotiating their lease every five or 10, you were only doing it every five or 10 years.
And they're, you know, their expertise is in clinical dentistry. But what keeps popping up for me is just not knowing what they don't know or not knowing what to ask for. Which again, gets back to finding a qualified expert in that area that can represent you that you trust to make sure you're getting a fair deal based on what the market conditions are. That's a great point. I mean, we try to delineate all the time, there's a difference between finding a property like calling it a sign or getting online and going into a database and downloading a brochure and you find the property and then you secure in terms of signing if that's not a successful transaction, that's completion of a transaction. But that's not a successful transaction. And I joke about this but at the same time, it's true. Like I can remove my own tooth Okay. Tom Hanks, show people how to remove a tooth and Gassaway you can isolate a rock and you can get your teeth out of your mouth. Okay, great. That's not a successful transaction. So it's not a matter of whether you can do it yourself or not. It's a matter of how you do it the most the most profitably, how you protect your time and then how do you protect yourself from a legal or business perspective as well. There's a lot of things in life that you could do that don't make sense for you to do financially or don't make sense for you to do legally. And so you bring in the expertise to do it for you. It's not a sign of weakness, it's a sign of actually being savvy and being a lot more heightened and expertise finding the people are the most qualified, letting them come in and then they're going to see terms and we're gonna deliver a process that is not going to be achieved if you do it yourself. Such gets points in there and it's going to use the castaway. The movie example because I've used that before to to sort of differentiate between getting something done and getting getting something done right I want to circle back you touched on earlier in our conversation but the the idea of assignability of Elise, this is important because in my experience any kind of dentist is considering selling a practice confidentiality is of the utmost importance and there's a perceived greater amount of leverage, the more confidential potential transaction is that gets a little bit gray when you start talking about assignability from where I sit, because you've got to sort of tip your hand maybe and I'm interested your perspective on this about what you might be doing in the next five to 10 years if you start dancing around the idea of assignability. So with that as a backdrop, how should the dentists think about assignability obese? Well, I'll say this, I'll say that if you're gonna if you're going to key at any point in this podcast, this next part is worth the price of admission. Okay, the assignability class on that every dentist we pay attention to so let me let me just start by giving a general overview and some of you already know this, but I'm going to hit probably a level that you might not have thought about before. So in leases, you have the ability to have what's called an assign ability clause and or a sublease clause. Usually they're separate automatically combined, but they mean different things. And so what that allows you to do is if you wanted to let someone else enter the space either to sublease space at least a portion of your space, maybe you're a pediatric dentists, you want to be an orthodontist, or what have you. You want to sublease to someone else, you can do that. For the side, it only deals with what if you actually want to have another entity take over your lease, right? And so there's couple things here number one, make sure that you have that clause in your lease allow you to do those things. But once you start getting into the details of the complexity of the solidity class, the next most important thing you have to be aware of is it's imperative to have an assigned a duty clause that allows you to be removed as the tenant and removed as a guarantor. So people a lot of times get blinded by this idea. Well, I haven't decided on a class rate, does it give you the right to be removed as a guarantor? And this is the number one place where dentists that are exiting a practice or selling make a mistake? They'll say, Well, I haven't assigned a buddy clause and then we'll look at it. It doesn't guarantee them to be removed. As a personal guarantee. So sorry to use the word guarantee twice. But no, let me interrupt you there. So what does that effectively mean that a dentist cannot sign a lease but at the end of the day, if the other if the new party default on at least at the bookstore stops with the original dentists is that effectively what it means? significant number of landlords are gonna try to keep the selling dentist on as a guarantor, let's say maybe they signed a 10 year lease and there's like eight years left and they say Why Why have the right to assign it? Here comes the buyer. And then it says great, well, except the new buyer, but you're still on the hook for the next eight years, the lenders will fight the senior dentists did not get off at least you say, Well, why would they do that? Well think about it. The dentist who's in the space is a proven commodity and paying rent for 510 1520 years. And they look at the senior dentist who's selling your practice their financials and they're, you know, 5060 years old, what have you. And I mean, look at the individual that just find the practice if it's not a corporate group. Well, this person is 20 years old, and you're 60 like let's look at the financial statements. You're way stronger, we want you to stay on board. So having a steady clause is imperative, but equally imperative are very much need to pay attention to is the idea that you have to have an accountability clause that allows you to be released from the lease of the transaction and that the new dentist will be accepted. And even Honestly, even when it's a corporate Dental Group that has huge financials you'll still find landlords that will say Oh, I'm sure they're successful. Yeah, actually the financials but big groups go out of business all the time and who knows what the patient's gonna stop them and so you'll still see even with landlords, when a corporate group is buying the practice and they'll still try to keep that selling that is on the hook and say, I want as much protection immunity as possible. This is from an outsider my thought in discussing this would be want that on the lease from the beginning. You have to fight for that from the beginning and to put words in your mouth. Is that a deal breaker if someone if a landlord won't concede that point in the beginning, should you walk away from from a piece of real estate based on that alone, upfront? Yeah, I wouldn't walk away from a deal over that deal point because this is a situation where if you were leasing a space, you're not planning on selling your practice for 20 years, you could get a new landlord three or four times during the 20 year period time that would be more accommodating. When you go after on a lease renewal. So I wouldn't kill a deal over that concept. Personally, whether it's a new a new deal or renewal, but I would work very diligently to achieve the correct terminology and decidability period or somebody's permission scuze me and then with that, what does that look like trying to get the landlord to agree in advance that if you do sell your practice that they will release you with a personal guarantor. And accept the new buyer as the guarantor. And there's criteria you can put into that terminology. There's benchmarks you can put in there I want to play attorney right now, but I'm aware of what those are. So you can go beyond just having a side and only clause that's step one getting into lease that's that's great. But the next step is it's got to be one that has the ability to release you as a guarantor and to accept the new buyer of your practice as a new tenant.
You do not want to guarantee a lease space that you legally don't have right to step foot in that space any longer. If you sold the practice and you're no longer the tenant record you don't it's a good idea if you sold your house you there's no way you sign up to be a personal guarantor for the buyers mortgage like you would never do that. And a lot of times this this happens, and then people say, Well, you know if it's the lease is expiring, and I'm not gonna be the one sign the new lease. That's great. Well, you can still find landlords will try to hold up a transition and get the selling doctor to pay like an exorbitant fee to do the transition or to break the lease or what have you. So and as long story short, make sure you haven't signed a clause and then number two, having it's not enough, it's got to have the right terminology in it. So yeah, just to kind of close the loop on leases and land landlords. So these things can hold up a deal or the sale of an actual dental practice depending how good or bad they are, and kind of what's that I'm hoping maybe we can transition it with with the time that we have less than to own real estate when a dentist owns the real estate for the dental practice. How does that fit into the sale and the transition out of a dental practice when the dentist owns the real estate that they're practicing? Yes, great question. So if you own your commercial real estate, you're an owner of a separate entity. Your practice should never be the owner of the real estate always be a separate LLC does not get that taken care of in advance. So they give attorney and then when that happens, you got a couple options. You can choose number one to write a 10 year lease or a long term lease with that tenant. And you can continue to have that lease and you stay as an owner and you're basically essentially picking up an annuity and other sorts of stream of income. Number two, you could choose to do an outright sale of the building at the same time you sell the practice and so getting the property valued up with with numbers that are fair for the real estate. In addition, the practice that's valid. A lot of dentists want to own the real estate and the practice that's very desirable for the buyer. You could also do a lease with an option to purchase in the future you might say hey, let's do a 10 year lease, I want five more years of cash flow for the real estate but I will give you a set purchase price after five years or after seven years whatever terminology or term works for you. So you can do an outline these you know now when I purchase you can do a lease with an option to purchase or you can write a lease with the the buying data. And then if there's no option than to purchase, you might decide to sell that to an investment group as well, anytime you want. So you've got a number of options that are there that the key is that you're looking for are you want to maximize the value of your real estate. If you own the real estate, you want to achieve a lease rate on a monthly basis that number one has to be fair for the buyer. You want to press the WordPress the limits of what that lease rate is you're gonna achieve the highest margin you possibly can. So there's no like set number for any deal. Someone can say, hey, this right here is $25. It's never a set number. It's always a range. It's the lowest number you probably hear the highest number up here and then where do you fall in that range depends on a number of factors. It depends the quality of property it depends on you know the renovations there how recently have things been upgraded? It depends on how desirable practices is the practice is super profitable, super desirable. It's a very premium on the lease rate. It also gives me an idea of like what other options are available if a dentist went about your practice, and then they wanted to move it in five years or seven years do they have legitimate options to do so if there's a lot of inventory, a lot of options, you know that that affects the lease rate if there's nothing available whatsoever, whether it's rural or whether it's really competitive market that gives you ability to push that the premium sell there's no one size fits all for that red number but if you're if you're selling the building with the highest value possible, but still to be fair for the buyer, if you're leasing it, you want the highest as least as possible, still gonna be there in the buyer. And so that's where you bring in expertise to help you navigate that process. And that's gonna be if I heard you correctly pretty location specific like where I live in Iowa. It's pretty it's more uncommon for a dentist to sell the practice and not sell the real estate with it when you get into more concentrated metropolitan area to get would be more common. And then obviously, yeah, like you get into a rural area in Iowa. And it's like, if it doesn't sell to the other dentists, we're going to sell it to us. It's kind of gonna sit there. So is that a fair takeaway, that it's really gonna be location specific? Yeah, that's that's a great point. And when you said it was great, too, because let's say you were in a super rural area, and if a dentist you bought the practice didn't buy the real estate, if you think you'd have a challenge so I'm going to someone else, you got a challenge achieving the same price on it, then yes, that's maybe motivation to make the real estate more competitively priced. So you can exit the practice and the real estate simultaneously. But the flipside is true as well. If you're in a location where hey, if a dentist didn't buy this, this property that a number of other people would be excited to buy in the money to pay up a higher number. Well, again, that gives you the power to push the value of that real estate up higher to maximize your return. On the investment. At the end of the day. You want the highest price, but you also want to be fair with it and you want to treat the other part the way you want to be treated. It just depends. If you're one of three or four other practices that are for sale to a certain facility, and they got a lot of options, maybe even trying to sell your practice for a while and it hasn't sold again. You just have to determine if whatsoever how hard you want to pull one lever if it affects the other one. But you know, at the end of day, if you're in a community where it's very common to sell the real estate with a practice that's way but you also control the transaction. So if you say listen, I will sell you the real estate but I want five more years of cash flow with the real estate I'm gonna lease it for five years and give you the purchase. That's a very common transaction as well. Some dentists are gonna say like I want to wipe my hands both I want to sell both and just move on sale off in the sunset. Other ones say no, I you know, I bought the property for 15 years if I if I do five more years at least will be fully paid off. And I wouldn't want to enforce that. And so just depends on what the doctor wants to do. Yeah, maybe you mentioned it, but I've also seen scenarios theory on like a bigger city or bigger metropolitan area where like the dentist wants to sell the property. The new dentist that's buying the practice wants to buy the real estate but they can't qualify financially to do both at the same time to need the situations where well the dentist wants to sell the practice they kind of didn't they they want to pick the buyer that they want to pick, and of course into this issue where they have to lease it for five more years or some set period of time until the new buyer can qualify for financing so to buy the real estate as well. That happens all the time. That's the main point. And that scenario is you talking to lenders and a lot of times the lenders will give you hopefully act information they'll say listen, if you give us three years of financials that meet these criteria at that point, yes, we do want to we want to sell or have you buy the belly for the seller.
So you might have an option to purchase after three years after five years after seven years. Does that just be a one time thing to be incremental? And I find sellers will do seller financing for the real estate or they will contribute towards the purchase as well. But yeah, that's very common, especially in the day and age when values are are being pushed to the highest level. If we get on this directly one question I want to ask before we sort of start to wrap up here is what should the selling practice owner be thinking about in terms of the real estate as they're starting to see the end of the line or that finish line in sight and kind of amendments that are to add on to that question, how does the real estate fit together to the sale of the practice when the real estate is also owned because the practice broker in my experience is dealing with the practice and I would think you would want a real estate professional like yourself to handle the real estate side of things. How do those two things fit together? Those are questions so let me let me hit the first one Why should pay attention to what your real estate is similar to if you were looking at selling a residential house you know, a new a new coat of paint, new flooring, new ceiling tiles, new lights, new window treatments, upgrading a sign here and there. Those things go a long way towards helping you know potential buyers or tenants see the value of your property if you've got from your property, maybe don't have to do hardly anything here you literally just like contact the practice broker or put on the market and it sells itself wha but usually walking through the space with the eyes of a candidate who's considering buying this if you walk in your space and your carpets old, your walls are jammed up, your doors are jammed up. It makes sense to look at how can I operate some of these things to maximize my value. Again, we're not talking about you becoming like a professional construction company to where you're fixing everything but you shouldn't pay attention to some of the general status and you shouldn't look into the eyes of a patient. You should look into the eyes of potential buyers. And usually you're doing that to three years in advance and you're doing it you don't just wake up one day I'm gonna sell my practice tomorrow unless it's a health issue or some challenge as you guys know do happen. But if you're if you're planning you said, Hey, I'm gonna sell my practice in two years, three years, five years, start looking at it walk into your space fresh because a lot of times the doctor will walk into their space and they see an everyday they go to the backcountry and they're used to seeing but if you walk in your space from the eyes of a patient or a potential buyer, and you put on a different lens, it's gonna give you a different perspective. And you're gonna probably find opportunities to improve your space, improve your status, improve the patient experience, and that's only gonna help you over the next two, three to five years as you're preparing to transition. And then in terms of actually you know, getting ready to do it. I highly recommend having someone who specializes in real estate to help determine value or giving information, you're gonna find a lot of practice brokers that will say, Well, I can do both, and they may or may not be qualified or sometimes brokers that are truly qualified as a bunch that are not and so just because someone's gonna help you value the practice doesn't even the best person help you value the real estate. It doesn't it never hurts me to get a second or third opinion on those things. And you can do so with confidentiality. You can do so with an NDA. You do so with professionals that are gonna protect your confidentiality, people that are seasoned professionals that are gonna treat you the right way. But having someone help you with the real estate, I'll evaluate help you actually in the transaction itself with the buyer and seller. It's gonna make the process go a lot smoother on anything that we haven't hit on today that you think would be important to add before we sort of wrap things up. I would say this, I would say just to emphasize, we emphasize the idea that if you're doing a lease renewal, whether you're gonna practice for 20 more years or only one year, or sell it tomorrow, tremendous opportunity to capitalize on these renewals any real estate transaction that you do there's 100 to 100,000 hours on the line so just do it yourself approach is fraught with a lot of loss financially for you a waste of your time, and you're gonna most likely open yourself up to other pitfalls and complications that you weren't aware of. So no differently. You tell someone listen, go to the specialist, let them take care of this issue for you. If you if you need physical therapy, go to physical therapist, if you need you know if you need your teeth, right and you know, go to the orthodontist like you are the person that does it every day, day in and day out to do it for decades or for at least years and let that person help you. Same thing for commercial real estate. The name of the podcast is dentists puns, and money. You ready with your best dental related joke I wish I was likely there not to be here and I you know we do Joker point of anytime that we see the dentist that has the saying of the wall you don't have to brush your teeth just the teeth you want to keep like that's always a that's always a you know kind of a painful one right there I guess one if you've never seen it but if you've seen it dozen times, it's pretty layers of revenues. I do remember back in the day you walk into the dentist they have they have like the covers over over the flashing lights might have like the clouds and the pictures. I do like reminiscing over the old dental faces that still paint their their light covers. I think that'd be fine too. But yeah, that's the best I've got, unfortunately, so you're not gonna see me. I'm trying time with a job but you will see us prime time with your real estate. How's that? Like you read it and put it back together at the end? Well done. Well done. Jelena. I really appreciate your time today. Thank you for being a guest and for sharing your expertise. With me here. Thanks, John. That is Colin Carr, CEO of carr healthcare Realty. And we appreciate having him on Dennis tons of money. Thanks for listening and following along. Are you a dentist nearing your retirement from clinical or have you already hung up your handpiece? Would you like a treatment plan for the financial components of your exit from clinical? Our company that does exit planning helps dentists like you reduce taxes in retirement and optimize how to best live off your assets including the ideal time for you to start taking Social Security. If you'd like guidance on those critical pieces, or just a second opinion, schedule an initial consultation with us on our website. Our web address is dentist exit.com And there's no obligation for your initial consultation that website again dentists exit.com. As a reminder that says Exit Planning and turtle advisors LLC is a registered investment advisor. The information presented should not be interpreted or construed as investment, legal tax, financial planning or wealth management advice. It does not substitute for personalized investment or financial planning from dentist Exit Planning or Terrell advisors. LLC. Please consult with your accountant and attorney for tax and legal advice. 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Dentists, Puns, and Money
Colin Carr Podcast Transcript
Keywords: dentist, lease, real estate, landlord, practice, sell, tenant, transaction, buyer, clause, years, deal, concessions, commercial real estate, people, space, higher, pay, property, rate