When you’re preparing to open or expand a healthcare practice, real estate is rarely the part of the process you feel most confident about. You’ve spent years mastering clinical skills. The commercial lease sitting in front of you is a different language entirely.
That gap is exactly why working with a healthcare real estate specialist – not a general commercial broker, and certainly not a residential agent – matters more than most providers realize until it’s too late.
Stephanie Principe joined Justin Marti on the Office Hours podcast to break down what that specialized support actually looks like in practice, and why the difference between a generalist and a specialist can shape the trajectory of your practice from day one.
The Data Behind the Decision
One of the first things the PRG team does when working with a new provider is pull detailed demographic and competition data for their target market. This goes well beyond zip codes and traffic counts.
“We can pull the demographic information – we have in-depth competition analysis that we provide the doctor, so that they have that data on what the surrounding areas might look like,” Stephanie said. “That can help really drive them into either a specific location, sometimes a specific specialty.”
For a veterinary client, that might mean looking at how many pets a household owns, or even where households purchase their pet food. For a physician who wants to stop commuting an hour and a half to serve a community closer to home, it means running the data on whether that community can actually support a new practice. The analysis either confirms what a provider is already thinking or redirects them toward a more sound decision before they’ve signed anything.
“We can really drive and either support what they are thinking initially or drive them into making a data-supported decision that makes sense for what they need,” Stephanie said. “That is a tool that most doctors love.”
Most providers find this part of the process genuinely useful. They’re trained to analyze. Give them real data, and they know what to do with it. You can learn more about how PRG’s demographics and competition research works here.
The Team You Build Around the Transaction
Starting or expanding a practice involves more moving parts than most providers anticipate. Lenders, attorneys, contractors, equipment vendors, designers – the list of professionals involved in a single transaction is longer than expected, and how well they communicate with each other directly affects how the deal unfolds.
PRG’s approach involves getting everyone on the same page early. “In my very first conversation with them, I ask them: do you have contacts for all of these different things?” she said. “It’s getting them to understand how we all work together.”
That coordination isn’t just logistical – it’s financial. When a contractor understands the lease terms being negotiated, they can time their buildout estimates and phasing plans accordingly. When a lender understands the square footage and the tenant improvement allowance being pursued, they can structure financing with the right assumptions built in. Without that alignment, providers often find themselves staring at construction cost projections that bear no resemblance to what they were expecting when they first started the process.
“Getting them to understand that there’s going to be a chunk of money for the equipment, there’s going to be a chunk of money for working capital, there’s going to be a chunk of money for the construction, as well as everything that we negotiate within the deal itself – that is very helpful,” Stephanie said.
What Can Kill a Deal
Construction costs are one of the most common reasons deals fall apart. In the Northeast, Stephanie cited costs running roughly $200 to $250 per square foot – and when those numbers become real, providers sometimes reconsider everything.
The other deal risk she highlighted is a misunderstanding of lease term length. Providers who are nervous about committing to a long lease sometimes push for shorter terms as a hedge. What that actually does is reduce the leverage they have in negotiating tenant improvement allowances.
“A lot of people don’t initially understand the connection of the longer the term, the more likely you are to get more money,” Stephanie said. “They’re putting up this money for you to build out this medical space in their facility. Oftentimes, what that looks like on the landlord side is that they’re going a significant amount of time within that term before they make any money off of you.”
The TI allowance is money the landlord provides for a tenant to build out the space. It’s one of the most important financial terms in a healthcare lease – and it doesn’t exist in isolation. The term length, free rent period, and construction timeline all connect. Pulling one thread without understanding how the others are tied together can unravel terms that took months to negotiate. PRG has written more on how TI allowances work and why they’re worth negotiating, and if you’re going into lease negotiations for the first time, it’s worth reading before you start.
Why Specialization Is Non-Negotiable in Healthcare Real Estate
If you’re opening a yoga studio, you could probably get by with a generalist. The lease is simpler. The stakes are lower. The buildout is less complex.
Healthcare is different. The demographic requirements are specialty-specific. The buildout costs are higher. The lease terms carry longer financial obligations. The space requirements – plumbing, operatory configuration, equipment infrastructure – have to be planned years in advance. And the agreements themselves are far more complex than a standard commercial lease.
“The real estate spaces themselves – you need a specialist,” Stephanie said. “You need someone that that’s all they do, the leases, and as you certainly know, the agreements and the contracts that they enter into are not just your ‘I’m gonna set up shop here’ situation.”
This applies across every specialty PRG works with – dental, veterinary, optometry, dermatology, med spa, surgery, and more. You can read about PRG’s full range of services and frequently asked questions to get a sense of what the process looks like from start to finish.
For providers making one of the largest financial commitments of their careers, working with someone who understands the nuances of your specialty, your market, and your lease is not a luxury. It’s the foundation the rest of your practice is built on.
Ready to start your site search? Talk to a PRG agent.
