31 Jan Own Your Practice Premises Freehold
Are you currently renting your practice premises and dreaming of owning the building?
Have you had enough of paying monthly rent, effectively covering someone else’s mortgage, while also investing heavily in your practice, improving the building and increasing its value, without ever owning it yourself?
Owning your premises isn’t just about avoiding rent; it’s about turning your hard work and investment into something that’s yours, building equity for your future rather than for a landlord.
Whether you run a dental, veterinary, or pharmacy practice, owning your premises gives you control, flexibility, and long-term financial security.
Leasehold vs Freehold Premises
- Leasehold: Pay rent over the lease period, with rent reviews usually every 3–5 years, typically increasing. You have limited control over any changes requiring the landlord’s approval and you never own the property.
- Freehold: You own the property outright, with full control over renovations and expansions. No rent, no lease renewals, and a property that grows in value.
Smart Ownership Structure
From our experience, freehold purchases are often structured to maximise flexibility and future value (always check with your accountant to find the best structure for your personal situation).
One common approach is to set up a new limited company to hold the freehold while keeping your existing trading business separate. The trading business pays rent to the freehold company, covering mortgage payments.
Why two companies? When the time comes to sell your practice, you won’t need to untangle the freehold from the trading business.
You could sell the trading business and retain the freehold, continuing to receive rental income from the new owner, or sell both and benefit from the freehold’s value, which you wouldn’t capture if you only had a lease.
Banks Are Lending
Healthcare is seen as a low-risk sector for most lenders, who are often keen to finance freehold purchases.
Many lenders will fund up to 100% of the freehold purchase price, and loans can often be structured over long terms up to 30 years reducing monthly repayments.
Lenders will ensure the practice generates enough income to service the mortgage, which is often comparable to your current rent.
Landlord Not Selling?
If your landlord doesn’t want to sell, you still have options.
You could move your practice to a new location; as long as it’s within a certain distance, lenders may still fund 100% of the freehold.
Additional costs may apply for converting the new premises, but lenders often finance this. Always check your existing lease for potential exit costs.
Get the Right Team
Make sure you have the right team in place when purchasing a freehold: a finance broker to secure competitive market rates, an accountant to structure the transaction correctly for your situation, a solicitor familiar with the healthcare sector, and a qualified surveyor to value the building and ensure you pay the correct price.
Why Freehold Makes Sense
Owning the freehold allows you to build equity for yourself, not your landlord, and gives you control over your practice’s future with long-term certainty.
Many lenders offer up to 100% financing, and the property could provide rental income even after selling the trading business.
We specialise in helping healthcare businesses secure funding, so you can focus on growing your practice.
Contact us today and make freehold ownership a reality.
Assisting with the set up, purchase and expansion of healthcare businesses is what we do.
Contact Saroma, for an initial conversation to explore your options.
