Pros & Cons of Various Options for Leasing Medical Office

Direct Lease, Sublease or Timeshare? The Pros & Cons of Medical Office Leasing Options

You typically have three options when it comes to leasing medical office space: direct leasing, subleasing and traditional timesharing. Each leasing option brings with it benefits and drawbacks that may impact your decision. Developing a better understanding of exactly what they are may help you determine which leasing option should best suits your needs.

So, before you sign on to occupy a particular medical office, let’s help you understand some of the pros and cons of each lease type.

Direct Leasing

 Direct leasing is the most commonly used form of the three leasing options for medical practitioners and doctors. This type of leasing involves you signing a multi-year lease on a medical property and then assuming all responsibility for it.

Direct Leasing Pros

Arguably, the biggest benefit of a direct lease is that it gives you maximum control over your space. As long as you adhere to any parameters set by your landlord, you should be able to equip the space however you wish to accommodate your needs. Maximum customization allows you to build and scale your practice as it grows or changes.

Direct Leasing Cons

Most direct leases last between three and five years and involve spaces that are 1,500 square feet or more. If your space and other needs change during this timeframe, you may be out of luck. You are also going to be responsible for 100% of associated expenses related to build-out, furnishings, rent, utilities and so on, and these costs add up quickly.


A sublease involves you setting up shop in the excess space of someone else and then paying that party rent and a portion of overhead costs.

 Subleasing Pros

Upfront costs are generally lower with subleased medical space, and you may also benefit from shorter lease terms and lower monthly overhead costs. Since you are taking over an existing space, often you the space may come ready to use right away.

Subleasing Cons

 Subleasing options may prove hard to come by, and even if you find one, you are still going to have to abide by the main tenant’s guidelines. If the main property tenant decides more space is necessary, you may need to vacate your practice relatively quickly. Since you are not the direct lease holder, you also have limited flexibility when it comes to customizing the space to your own needs.

Traditional Timesharing

As the name suggests, a medical timeshare is similar to a vacation one in that it allows you use of a particular medical space on specific dates or times.

Traditional Timesharing Pros

Timeshares can be great options for physicians looking to practice part-time. They are also often move-in ready, saving you time and money on furnishing or building them out. Timeshares tend to offer more flexibility than direct leases.

Traditional Timesharing Cons

 Often, timeshare suites are older and may be located in unfavorable parts of a medical office property. You may find timeshares are only available in facilities controlled by hospitals, which means you may have to deal with hospital oversight and additional fees.

It’s important to not only consider pricing, but also where you are in the lifespan of your practice when looking at the different leasing options. Are you just starting out and looking to understand what your needs are at lower overhead? Subleasing might be the best start for you until you can better lay out your needs. Are you established in your practice and want the ability to customize the space to your personal needs? Direct leasing will give you flexibility to design and develop your space while giving you a long-term solution. Are you a specialist or looking to move your practice to a part-time basis? Timesharing a space could be the post cost effective and flexible fit.

Need help figuring out what type of medical lease might best suit your needs? Call Plaza Companies at 623.972.1184 or drop us a message online.

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Whether you are looking to us for management, leasing or development services, we can help you find the perfect space. With over 40 years of experience, you can trust Plaza Companies to assist you with your real estate needs.

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