Medical Office Advice

[Vu T.]

Hi BP,

So I came into possession of 2 medical offices, about 1150 sqft each.  One has about 7 rooms + 1 br.  The other use to be a cafeteria of some sort so it has a large room + 3 smaller room + 1br.  This building is located among other physician and medical-related offices and across the street from a small hospital.

My question is, the inside is moderately beat up.  The floors that had carpet definitely needs to be pulled up and replace.  Ceiling tiles has stains and holes etc and walls and doors need to be repainted badly.

My question is, would you guys do light rehab on this to make it presentable (lay vinyl on the floors, a coat of paint and new ceiling tiles) knowing that the new tenants may end up doing a lot of TI to suit their own needs and ripping everything up?  The many physicians I know usually end up fixing up the office to their liking.  But of course some don't.  I'm having a hard time debating if I should clean it up just to get some tenants in there.  Posting an ad with inside pics looking the way it does won't exactly get new docs excited.

What are your experiences with these kinds of medical offices (or just offices in general)?

(Sorry if this was discussed somewhere else, I couldn't find any threads)

[Aaron Bushell]

Depends on the amount you are ready to invest.  I agree that light rehab will likely make the building more appealing to potential medical tenants, but you're also right that most of them are going to want to rehab the space to fit their own vision.  It's kind of a chicken/egg situation.  I would definitely slap some new paint and ceiling tiles in, but before you go and spend thousands of dollars on flooring rehab I would try and get a few prospective tenants in and see if the current state of the building puts them off of wanting to rent.  If so, you can always start the remodel work a few weeks down the road.  If nothing else, go get some samples and have them up front so that when your prospective tenant walks in, they can see what you plan to use and visualize the finished product themselves.