With some practices that are listed, you will find the owner signed a lease right in the middle of a high commercial real estate market. The rents are 30 to 40% higher than the current rates with 2 to 5 years left on the lease.
What's a buyer to do?
What I typically do is try and negotiate a new lease. I let the landlord know we'll sign an extension to the lease if he'll bring the rate down to market. I show them comparable properties in the area. If that doesn't work, I'll have the seller speak to the landlord and let them know they can't sell the practice with the high lease and they might have to move the practice. If none of that works, I then turn to the seller and ask him to lower the price of his practice to account for at least 50% of the additional rent amount. If the difference between the current market rent over the remainder of the lease is $100,000, I'll ask the seller to reduce the price by $50,000 to assist in covering the rent over the term of the lease.
If none of the above work, you then need to decide if the amount is high enough to walk away, or purchase the practice and work with the rent where it is.
We are always here if you have questions.