Office Condo - concerns about unit with third party owner

[Alexander S.]

Hello all,

I am looking into purchasing a condo unit as a medical office for our practice in northern Virginia. The intent is to then lease the office back to the practice. The condo is a unit within a building owned by a third party (i.e., not a condo association). I have been advised that buying individual condo units in this situation is generally considered a poor investment with the following concerns:

1) Depreciation - I was thinking of purchasing the office with some of the other physicians by forming an LLC. Is it true that depreciation of the office cannot be used for tax advantages in this situation?

2) Land ownership - as an owner of the unit, do I have any ownership of the land itself? Should I then assume that there will be minimal appreciation over the next 10-20 years? Since I may not own any actual land, what would happen in the event the building owner decides she wants to bulldoze it - what sort of financial protection is in place?

3) Condo fees - are there any legal limitations to how much the building own can increase condo fees? This building has high fees already at about $7/sqft but it includes nearly everything (electric, trash removal, HVAC, roofing repairs, landscaping, snow removal, etc).

I apologize if some of these things seem like novice questions but I have scoured the internet without finding clear answers!

I genuinely appreciate any help and guidance.