When preparing to sell your dental clinic, most owners focus on financials, patient numbers, and equipment — but one often-overlooked factor can significantly impact your sale price: your lease agreement.
At Sinosmart Business Brokers, we’ve seen firsthand how lease terms can either strengthen a deal or cause it to fall apart. Here’s why your lease matters more than you might think:
1. Security of Tenure Builds Buyer Confidence
Buyers want assurance they can operate in the same location long-term. A lease with at least 5 years remaining (plus options) is ideal. Short or uncertain leases can reduce buyer interest — or your sale price.
2. Rent Terms Affect Valuation
Above-market rent or steep annual increases can eat into profitability, which directly impacts your clinic’s valuation. A fair, well-structured lease makes your business more attractive and financially viable.
3. Transferability Is Critical
If your lease doesn’t allow for assignment or requires complex landlord approval, it can delay or derail a sale. Buyers (and their lenders) want a clean, assignable lease with minimal red tape.
4. Location Ties to Goodwill
In dental practices, goodwill is often tied to the physical location. A secure lease helps preserve that goodwill — and the premium price that comes with it.
Real Example:
A Sydney clinic we worked with was initially valued at $1.2M. But during due diligence, the buyer discovered the lease had only 18 months left with no renewal option. The result? A $150,000 price reduction — or risk of the deal falling through entirely.
The Bottom Line
Your lease is more than just a legal document — it is a key driver of your clinic’s marketability and value.
If you’re considering selling, now is the time to review your lease terms. Strengthening your lease position before going to market can lead to a smoother transaction and a higher sale price.
At Sinosmart Business Brokers, we can help you:
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Assess your current lease terms
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Identify potential risks or deal-breakers
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Work with your landlord to negotiate improvements
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Position your practice for a successful sale
📞 Ready to plan ahead? Contact us for a confidential consultation and take the first step toward maximising your clinic’s value.
