Practice owners approaching lease renewal often ask: “Can I get funding from my landlord to update my space?” The answer is yes – and typically far more than most doctors realize.
This funding, known as tenant improvement (TI) allowance, is negotiated by your broker not just during initial leases, but also during renewals to cover upgrades to your existing space.
Real Results from Real Renewals
Last fall, a physician approached us with her lease expiring in approximately one year – ideal timing for renewal negotiations. Her practice was thriving in its current location, but the office itself needed modernization.
Through strategic renewal negotiations, we secured over $75,000 in TI allowance. This substantial funding allowed her to:
- Replace outdated flooring throughout the office
- Install new cabinetry
- Repaint the entire space
- Revitalize the practice without relocating
Similarly, we’re currently finalizing a renewal for a doctor who’s been in her grocery-anchored location north of Austin for 18 years. She wants to extend her lease for another decade but needs to replace worn flooring. We’ve negotiated approximately $33,000 in TI allowance to fund these updates.
The Broker Advantage in Renewal Negotiations
In both cases, our approach included:
- Drafting a renewal Letter of Intent with strategic baseline terms
- Making calculated TI allowance requests based on market research and property specifics
- Handling all landlord negotiations directly – our clients never had to engage
- Guiding clients through signing renewal agreements that included significant landlord-funded improvements
Is Your Practice Ready for a Strategic Renewal?
While every negotiation differs, you’re in an excellent position to pursue TI allowance if:
- Your practice is successful in its current location
- You have less than two years remaining on your lease
- Your space needs updating or reconfiguration
A healthcare-specialized broker can help you leverage your position as an established tenant to secure the funding needed to modernize your practice without the disruption and expense of relocation.
Ready to maximize your renewal opportunity? Contact Practice Real Estate Group today for a consultation on your upcoming lease renewal.
