Thank you to everyone for sharing a delightful evening with us!!
The Wynmark Team
Hot off the Press – D Magazine’s Commercial Real Estate Opinion:
By our very own principal – Justin Keane!
It’s that time of the year…
Time for Wynmark’s annual Angel Tree gifting!
This week we were honored to continue Wynmark’s holiday tradition of adopting an angel. Thanks to the Salvation Army Angel Tree, we are thankful to be bringing joy and happiness to a child in need during this holiday season.
Happy Holidays from Wynmark Commercial!
Congratulations to Dr. Nguyen, Dr. Le, and Dr. Hunt on the Grand Opening of Frisco’s Dental Place. This is one of the final medical offices to open in Victory Group’s, Victory @ Stonebriar mixed use development. The office was beautifully designed and combines the cozy, traditional feel of a dental office with modern elements like exposed ceiling and ductwork. This will no doubt be a staple of the Frisco community for a long time.
By: Justin Keane, Principal of Wynmark Commercial
Real estate in the healthcare industry has traditionally revolved around a classic lease model for physician practices. Doctors would personally guarantee long-term leases and place their practice in the best possible locations to cater to their patients. This is a model that offered doctors little advantage outside of liquidity of capital.
Market conditions today offer physicians more options. Changing healthcare laws in recent years have impacted physician practices by decreasing reimbursements, which forces the physician to see more patients throughout the day. Though patient care is at the forefront, physician practices, like any business, still revolve around being profitable. Many responded by closing their individual practices and joining large hospital groups. Others took a more entrepreneurial approach and decided to further invest in their practice by investing in the real estate. (Why pay a landlord hundreds of thousands of dollars over the course of 10-year lease and walk away with nothing to show for it?)
Seeing a need in the market, I co-founded Wynmark Commercial in 2009 to specialize in medical office space. Here’s what I’ve found when it comes to leasing versus ownership.
Investing in real estate provides an additional profit center to help with a physician’s long-term goals. And with interest rates still hovering near a 10-year low, it’s still a great time to lock in rates now before the Fed starts increasing them.
Lenders will require between 10 percent to 20 percent down, depending on the type of loan (SBA vs. conventional) and the leveraged investment will build equity and provide additional tax benefits. Even in the worst-case scenario of the asset not appreciating over the 10+ years of owning a building, physicians are still paying down principal and utilizing the tax benefits. This commitment is an exit strategy and retirement plan rolled into one. If a physician practices another 15 to 20 years, the real estate has served as a forced savings plan. With every payment made over that time, a doctor has been paying off an asset that can now be sold or leased.
The presence of this asset can increase the value of the practice as well. This is especially true in dental practices. A thriving dental practice will, to a certain extent, always be tied to a location. If a practice has been at a certain intersection for 15 years, it is not as valuable if it has to be relocated outside of a two-mile radius when the lease expires. Doctors will take this into consideration when evaluating the purchase of an existing practice. If the practice is on a lease, the length of time remaining on the lease and a potential forced relocation at lease expiration are factors in trying to determine the value. A practice with a fixed asset tied to it is more valuable at the point of sale.
Ownership also carries with it valuable tax advantages. With a standard ownership model, there exists the ability to depreciate the building over 39 years, write off the interest, and write off the budgeted expenses. (As always, a CPA can go over all the benefits and how ownership will affect you personally.)
Physician leasing isn’t going away any time soon, though. In fact, the more traditional lease model remains the best option for start-up physicians or groups needing the capital for large growth expansion plans. Doctors looking to start a new practice are motivated by the lower initial cost offered by leasing. It allows the physician to establish a patient base and identify the growth potential for the practice before setting up more permanent roots.
Lenders also want to see historical trends for a practice before investing in the real estate. Leasing allows the flexibility to build that credibility and establish the practice. A healthy long-term forecast is especially important for start-up practitioners.
For most physicians, the own vs. lease debate will come up throughout their careers. It’s a choice that has significant implications on both their practices and long-term investment goals. For those faced with the decision, it’s important to establish your objectives, do your research, and crunch the numbers before choosing what option is best for you.
Justin Keane is president of Wynmark Commercial. Contact him firstname.lastname@example.org.
The once lively neighborhood is seeing renewed interest as it becomes a breeding ground for innovation.
By Justin Keane
It’s not crystal clear. You still have to squint to see it, but with a little imagination you can see an organically engineered innovation district blossoming in the heart of Dallas. The West End, or Historic West End as it is often identified, is the site of the would-be transformation. It is certainly historic and a common stopping ground on weekends for camera toting tourists, fresh off a jaunt back in time at the Grassy Knoll and Sixth Floor Museum (Book Depository). However, it long ago quit being a destination for local Dallas residents. Historic buildings that once housed restaurants and night life slowly started going dark. The buildings were shuttered and patios that were once filled with memories of OU/TX weekends, and concerts in the plaza outside of Dallas Alley, became a block of abandoned but beautiful buildings living out their accelerated half-life.
Some new-found momentum and life in the West End is looking to change all that. The Dallas Entrepreneur Center (The DEC) has found a creative way to facilitate growth of new companies into future contributors to Dallas’ overall economy. Factory Six03 is renovating the iconic property at 603 Munger Ave. into a 215,000-square-foot modern, co-working space. Built in 1903, the building is most commonly recognized as the West End Marketplace building, but was originally the Brown Cracker and Candy Company.
Within the same building, the Blue Cross Blue Shield C1 Innovation Lab is about ready to open its doors. The company’s fresh, collaborative approach towards analyzing healthcare and its processes is thinking outside the box for the industry. Kevin Cassidy, president for Health Care Service Corp. which operates Blue Cross and Blue Shield in Texas, is enthused about the location of their new facility. “We chose Dallas because the city is a thriving, innovative hub for healthcare entrepreneurs who share our goal of finding solutions that make our healthcare system more efficient, affordable, and effective. This project emphasizes our commitment to Dallas and we are excited to be a part of the West End redevelopment. The West End is especially accessible for our customers and the building provided a blank canvas to create a space focused on collaboration. We are on schedule to open the C1 Innovation Lab in August.”
Innovation is not being ignored at the street level either. The Dallas Innovation Alliance launched the first phase of its Smart Cities Living Lab back in March of this year. The project brings interconnectivity and intelligence to city infrastructure. With features like smart LED lighting and environmental sensors, the Lab can allow cities to learn and adapt in real time through a future forward application. It’s street presence is through a kiosk that helps locals and visitors handle more daily tasks, such as maneuvering around the city or utilizing the kiosk’s free USB charging ports.
For anyone who can remember back to a time when the West End was a lively gathering spot for locals and tourists alike, the thought of one of Dallas’ treasures re-emerging as an innovation district is sure to inspire some enthusiasm. And, for quite some time now, our Historic West End has needed some enthusiasm.
Justin Keane is principal at Wynmark Commercial.
Mapleplex Office Centre construction has been completed – May 2017. The 22,000 sf office building is located at the NWQ of Coit and George Bush with traffic visibility from the President George Bush Turnpike. There is 9,600 sf available for lease on the first floor. Please contact Matt Fulgham for more information, (214) 223-5227.
“I had already given two other brokers the opportunity to sell and/or lease my real estate in Carrollton [and] encountered many frustrations ranging from broken promises to downright being ignored. Phone calls, emails and texts were oftentimes never returned. Signage was never erected. That all changed immediately when Wynmark was put in charge of the project.
While a year had passed without any results with my previous two agents, it took Wynmark a mere three months to get one of my spaces leased and my property sold! Wynmark professionals navigated me through this complicated maze and did so with aplomb. “Glen Blanchard, D.D.S.
Building a relationship of trust can be difficult to accomplish in today’s fast paced business world. With Justin, I felt he truly had my best interest at heart and would recommend him to anyone looking for new medical office space.Dena Robinson, DDS
Mark walked us through, in detail, the process of finding a location, designing, developing, and building our new office. He was also able to provide us with a full development budget and show us how the financing works for a medical office building. He put us in contact with several lenders who would be able to provide us with financing for our new building. This assistance helped relieve much of the anxiety about this part of the process. Based upon our development budget and timeline, we were able to stay right on target with the expected costs and timeline for completion. The best part of all is that Mark took care of all the development process, which allowed us to focus on our practice and the interior design of our space. Everything moved forward just like we had planned and we were able to move into our new location in November of 2009. Mark’s excellent customer service and knowledge of the process was integral to our satisfaction with the experience. He was able to help with any problems or questions we had throughout the process. Wynmark is excellent to work with and we would highly recommend them to anyone considering purchasing or constructing a new medical office building.McKinney Pediatrics, P.A. – McKinney, TX
Wynmark was very attentive and professional and it was a pleasure to do business with them. I would highly recommend them for any office space needs you may have.Allan R. deVilleneuve, M.D. – Frisco, TX
Wynmark truly understands what customer service really is all about. I would highly recommend them if you are looking to buy or build a new building. Moving into a new medical space is an exciting process – with Wynmark on your side you will feel that much more confidant.Kirk Mahon, M.D. – Frisco, TX
We were a start up dental practice, so Wynmark helped us get an incredible price on the building. They were also able to get us multiple loan options that were right in line with what they had budgeted for us in the beginning. If you are looking for a dental/medical space, I would recommend working with Wynmark. This was our first location, and we will definitely use them next time to find our 2nd space.Tina Bui, DDS – Irving, TX
In today’s business world, it is rare to find a group so earnest and reliable. I whole-heartedly recommend Wynmark if you are looking for new medical office space.Dr. Thai Hoang – Frisco, TX
If you are looking for a new space, I would recommend working with Wynmark. They truly understand what you are going through and will do everything they can to help you. It is nice to have a group you can work with that you also know are your friends.Eric Kavosh, M.D. – Plano, TX