When renting medical space in New York City, it is important to realize that a significant number of landlords aren’t keen on renting their spaces to medical folks. It’s a landlord-by-landlord issue but many Landlords may opt not to have medical tenants because of all the added foot traffic and specific construction requirements. As I am sure you can imagine build-outs with running water in every office and lead lined walls for X-Rays are not commonly found it most buildings and constructing these installations can be costly.
Generally speaking, the high profile and more expensive buildings in New York won’t allow medical tenants. Others will allow dentists and therapists, but draw the line at anything that involves blood. Because medical tenants are not as sought after as your typical law or investment firm you’ll need to find medical space in the less high profile and more offbeat buildings. Unfortunately, this doesn’t necessarily mean that those looking for medical space will get cheap rent – on the contrary, because there’s a demand for medical spaces and not so much supply (what with the limited supply of buildings and the increased build-out costs), the rates can be higher than a typical office tenant would pay.
Here are a few things you should know:
- When a landlord is willing to accept medical tenants, he’s pretty much guaranteeing himself tenants and higher rents. Medical tenants tend to clump together, as this makes for easier referrals, and since landlords know this, they can artificially inflate their rent prices.
- Landlords may opt not to have medical tenants because of the amount of upkeep they cause. Medical offices mean a lot of foot traffic, higher build-out costs, clogged elevators, and more cleaning to be done. Many landlords don’t want the added trouble.
- As stated above, a lot of landlords don’t take medical tenants but a good broker will know who does and who doesn’t and will be able to navigate this on your behalf. Thanks to the current economic landscape, more landlords are opening themselves up to medical tenants just to fill their buildings. Three years ago, when the market was at a high, it was much harder to find a landlord willing to take in medical tenants.
- Many medical people would prefer to own their own spaces. Unfortunately, 99% of commercial real estate in Manhattan is not for sale! Doctors love commercial condos but they can be very expensive.
What it comes down to is this: if you’re looking to rent medical space, find yourself a top-notch tenant representative real estate broker as looking for medical space can be a challenge.
