Real estate decisions can have a long-lasting impact on the success of your veterinary practice. Whether you’re opening a new location, expanding an existing clinic, or renegotiating a lease, the terms of your lease or real estate agreement can affect your financial flexibility, operational freedom, and long-term business value.
At Mahan Law, we help veterinary professionals evaluate and negotiate commercial leases and real estate contracts to ensure they’re fair, clear, and aligned with their business goals. Understanding the legal and financial implications of these documents is essential to avoiding unexpected costs and disputes down the road.
Understanding the Stakes in Veterinary Real Estate
Veterinary practices have unique needs when it comes to commercial space. Zoning requirements, noise regulations, parking availability, and space for medical equipment are just a few considerations that make these agreements more complex than standard office leases.
In many cases, veterinary professionals are so focused on starting or growing their practice that they sign a lease without a thorough review. Unfortunately, unfavorable lease terms can lead to:
- Unanticipated rent increases
- Restrictions on equipment use or remodeling
- Penalties for early termination
- Costly repair obligations
- Disputes over property use or exclusivity
To avoid these pitfalls, it’s essential to examine every clause in the lease or real estate agreement—and negotiate where needed.
Key Lease Terms to Review
A commercial lease is a legally binding contract, and once it’s signed, you are committed to its terms. While landlords often use standard templates, these documents can—and should—be negotiated to suit the specific needs of your practice.
Here are some critical lease terms to review:
Rent and Escalation Clauses
The lease should clearly define the base rent and any increases over time. Look closely at:
- How often rent increases
- The formula used for increases (fixed amount or percentage)
- Whether common area maintenance (CAM) fees or taxes are included or separate
Small, recurring increases can add up over the life of the lease.
Use Clauses
This clause defines how the space can be used. For veterinary practices, the lease must allow:
- Medical services and procedures
- On-site boarding or grooming (if applicable)
- Use of X-ray and lab equipment
A vague or narrow use clause could limit your ability to expand services or introduce new revenue streams.
Tenant Improvements and Repairs
Veterinary practices often need to customize their space for medical use. Make sure the lease specifies:
- Who pays for build-outs or improvements
- Whether landlord approval is required
- Who is responsible for repairs and maintenance
Some leases shift unexpected maintenance or HVAC costs onto the tenant, which can be expensive.
Assignment and Subletting
Your lease should allow flexibility if you sell your practice or want to bring in a partner. An assignment clause determines whether you can transfer the lease to a buyer or sublet part of the space.
Landlords may require approval for assignment or charge fees. Ideally, the lease includes reasonable terms for these scenarios.
Exit Terms
Early termination, relocation clauses, or personal guarantees can create challenges if you need to move or close the practice. Review:
- Termination fees
- Conditions for breaking the lease
- Whether you are personally liable for lease obligations
Limiting personal exposure and having a clear exit strategy can protect your financial future.
Purchasing Property for Your Practice
In some cases, veterinary professionals choose to buy property instead of leasing. Owning your clinic can offer long-term investment benefits and greater control over the space, but it also involves added responsibilities.
When purchasing commercial real estate, key issues include:
- Title and zoning verification
- Property inspections and environmental reviews
- Negotiating purchase and sale agreements
- Reviewing loan documents
- Understanding deed restrictions or easements
Our team can help ensure that all due diligence steps are followed and that the purchase agreement protects your interests.
How Mahan Law Can Help
We assist veterinarians at every stage of the lease or purchase process, including:
- Reviewing lease or purchase documents
- Identifying unfavorable terms
- Negotiating with landlords or sellers
- Coordinating with brokers and lenders
- Guiding lease renewals or relocations
With industry-specific knowledge and a practical approach, we help you avoid common mistakes and secure agreements that support your goals.
Set Your Practice Up for Success
Real estate decisions are about more than location—they’re about protecting your investment, controlling your environment, and supporting your long-term growth. Whether you’re signing a new lease, renewing an existing one, or purchasing your clinic’s property, don’t go it alone.
Let Mahan Law – Veterinary Law Firm help you review and negotiate real estate agreements that work for your practice. Contact us today to ensure your veterinary practice has a solid and favorable lease or real estate agreement.