Are you preparing to sell your dental practice? If so, you’re probably starting to organize financial data and patient records, and perhaps investing in updated equipment. But have you considered the value of updating the way your office looks?
In our earlier post, we gave you top tips for selling your dental practice. One way to increase the sale value is to spruce up your office space. Spring cleaning is in the air and now is the perfect time to focus on re-designing your dental practice.
This is your patients’ first impression, so make it count. The colors should be warm and welcoming; avoid using bright white or stale hues. Make sure to have at least one plant, and provide reading material, artwork, and modern, comfortable furniture.
Beyond simply touching up the paint, décor, and reception area, what else should you consider when making your dental practice visually appealing and patient-friendly?
Most group dental practices will need at least four exam rooms, which should be of equal size to minimize room turnover and maximize patient care. Hallways should be at least five feet across, and allow for 75-100 square feet of space in the common business area for each full-time employee. Exam rooms should be close to one another, and the room design should match your office layout and work style.
Incorporate bright lights for exams to avoid eye strain, ambient lighting to add warmth, and natural lighting as much as possible.
Try to avoid carpeting in exam rooms and laminate flooring in hallways. Carpeting is too difficult to clean, and laminate flooring can be quite noisy.
Walls and Ceiling
Walls can incorporate paint or sophisticated wallpaper; residential designs are becoming popular. Ceilings are often called “fifth walls” and can incorporate special effects such as altered ceiling heights, borders, art (yes, ceiling art is becoming a thing), and soffits, which can reduce noise. Make room for growth in technology needs, data lines, and lighting to avoid retrofitting in the future.
Plan to have at least 100 square feet of storage space, if possible, and central storage areas can save space in a smaller office.
Available Tax Deductions Make Office Improvements Easier
There are two tax deductions to consider using when you update your practice: leasehold improvements and bonus depreciation.
If you own the real estate, leasehold improvements can include permanent structural upgrades to interior space. Think about cabinets, reception desk, flooring, shelving, lighting, and certain technology systems. Leasehold improvements are depreciated over 39 years, so you can spread the cost of these upgrades over a longer time period. The tax benefit won’t be as advantageous if you’re selling right away, though.
Bonus depreciation, on the other hand, applies to upgrades of equipment and real property. Think chairs and operatory equipment, x-ray machines, other lab equipment, and practice software. You can write off 50 percent of the cost of the item the year you purchased it, but the benefit decreases after 2017 (so make those big ticket purchases this year!).
Time is your best resource when selling your practice, so start making a list of the office areas you can improve. Prioritize in order of what will have the best impact on a valuation and potential buyer, what’s financially feasible (remember the tax deductions you can use), and the amount of time you have to devote to decorating and design.
For more information, contact Ellen Dorner, Director of N/L Transitions. With over 25 years in the dental industry, Ellen’s experience will help guide you through the transition process from start to finish. She can be reached at 410-616-2042 or by emailing firstname.lastname@example.org