Montreal Lease Agreements for Medical Businesses Lawyers

Protecting the Interests of Our Clients

Signing a commercial lease often represents a major step in the expansion of your practice. However, signing a lease that does not include essential clauses or overtly favors the lessor can be detrimental to your medical business’s future. Through our relationships with the medical business community over the years, MÉDICALOI has developed an extensive understanding of the particular challenges practitioners face when leasing space for their facilities. We can leverage our knowledge to review and draft purpose-built lease agreements that meet the specialized needs of your business and safeguard it from common risks.

Secure the future of your medical business with a strong lease agreement tailored to your needs. Contact us today to review or draft a lease agreement that aligns with your goals and safeguards your business.

What Unique Issues Can Medical Businesses Face When Leasing Property?

Leasing commercial property involves navigating detailed agreements that require careful attention to avoid unnecessary risks or unexpected challenges. For medical businesses, these challenges are amplified due to the highly regulated nature of healthcare facilities. Medical practitioners face unique considerations and must ensure that their chosen property and lease terms align with the legal and operational requirements of their practice. Here are some important factors to consider when medical business owners plan to lease property:

Finding Comparable Spaces to Determine an Appropriate Lease Value

Assessing the market value of multiple properties can be challenging for a medical business owner. Various considerations can affect the assessment, such as foot traffic, prospective growth of the neighborhood, and nearby businesses. By consulting a law firm that is intimately familiar with the local medical business real estate market, you can ensure that your lease is fair and in keeping with area trends.

Evaluating the Property’s Suitability

Performing due diligence on the location before signing a lease is vital. Enlisting the services of a knowledgeable property inspector can allow you to identify any structural issues that could impact the usability or safety of the space. Other topics that should be investigated prior to entering into a lease include:

1. Accuracy of The Listing: The rental cost of a space is often based on its square footage. However, if this number is incorrect or includes significant unusable space, you may end up overpaying for the location – or worse, finding yourself unable to operate properly within the confines of the unit.
2. Need for Renovations: Most units will require at least some restructuring to meet the stringent demands of a medical business. Clearly identifying the extent of these necessary renovations may help you negotiate a tenant improvement allowance to offset some expenses. Lessees should also be aware of any clauses that require them to undo certain alterations at the expiry of the lease.
3. Ability to Meet Regulatory Requirements: Medical business locations are subject to strict oversight by the government. Failure to abide by building codes and other regulations can result in fines or closure of the location until the problem is remedied. Frequently encountered issues include proper medical waste removal, adequate ventilation systems, and appropriate accessibility accommodations for all clients. The property must meet specific standards for patient accessibility, safety, and equipment installation. For example, modifications to accommodate specialized medical equipment or hazardous materials may be necessary and should be addressed in the lease terms. Failure to account for these needs could lead to costly disputes or delays. 

Navigating Long-Term Lease Requirements and Renewals

The time and expenditure involved in locating a medical business to a new location is often substantial. Once you have settled into a site, it is generally preferable to remain there until your circumstances warrant a move. For this reason, a medical business lease is often a long-term commitment and should be approached with utmost care. You and your legal team should carefully examine the renewal and extension options within the lease to ensure you have the flexibility you need to continue operations at the current location. 

Paying close attention to relocation clauses and other agreement terms is also essential. For instance, if the landlord insists upon having the right to relocate your business at any time, you may wish to add a clause ensuring they are responsible for covering your expenses for renovating and moving to the new location, along with compensation for income lost during the transition period.

By working closely with legal counsel, medical business owners can thoroughly review and negotiate lease terms to protect their interests, meet regulatory requirements, and create a stable foundation for their practice. A well-drafted lease agreement tailored to the unique needs of a medical business is critical for its success.

How Can Your Lease Agreement Impact Your Ability to Sell Your Medical Business?

Entering a non-optimal lease can severely limit your capacity to control the future of your practice. Banks often require potential purchasers of a medical business to provide proof of a valid lease of a certain length (in many cases, 12 years) to obtain financing for the sale. If your lease does not meet the requirements and you are unable to update the terms, it may prove incredibly difficult to complete the sale of your business.

Assignment clauses can also prove challenging to navigate if you wish to sell or transfer your medical business. Under an assignment clause, tenants can assign their lease to a third party. However, some lease agreements may allow the lessor to refuse the assignment and terminate the lease instead. The tenant may be forced to acquiesce to the lessor’s demands to finalize the transaction or risk losing their lease altogether. 

What Are the Benefits of Publishing Your Lease?

If your landlord sells the property you are leasing, you may be at risk of eviction by the new owner unless you have published your lease in the land registry prior to the property transfer. In Montreal, tenants can publish their lease by notice via the Bureau de la publicité des droits du Québec. For more information on the process for publishing your commercial lease and the potential advantages of doing so, reach out to MÉDICALOI today.

Why Consult a Knowledgeable Lawyer Before Signing a Lease Agreement?

Lease agreements for medical businesses are complex legal documents that can have long-term consequences. A skilled lawyer from MÉDICALOI can provide the in-depth knowledge you need to understand the risks and benefits of entering into a particular lease agreement. We can assist you in negotiating the terms of your lease to ensure they align with your plans and aspirations for your business.

To schedule a free case evaluation with our experienced legal team, contact our Montreal office at (438) 805-5515.