What You Should Consider Before Leasing Medical Office Space

Confident male nurse in scrubs, standing in hospital hall, smiling with arms crossed

New York City has countless opportunities for healthcare professionals like yourself. Whether you’ve run a dental practice for decades, are starting fresh as a therapist, or are starting a new clinic, you’ve got nearly 10 million potential patients right outside your door. But succeeding goes beyond the numbers. It’s about connecting with people, understanding their needs, and impacting their lives. That’s what New York City lets you do.

You’ve put in the work, and it’s clear that you’re all about excellence. Your medical office should say that, too, in a place as big as New York City. Think beyond a regular workspace. You need a strategic asset, a place that elevates your practice. Top healthcare facilities like New York-Presbyterian, Mount Sinai, and Sloan Kettering? They’re not just names; they could be your neighbors, part of your network. You’ve also got a well-off demographic ready to pay out of pocket for your services. Plus, many successful executives have great health insurance and need a trustworthy provider like you. You can find countless of them in busy, high-density areas.

So, let’s help you find that perfect space. A space where you can thrive, make a difference and truly take care of your patients. Because when you take care of others, you deserve a space that takes care of you.

Manhattan’s Top Markets for Medical & Healthcare Practices

  • Upper East Side: Think of the Upper East Side neighborhood as the medical heart of NYC. You’re in good company with big names like New York Presbyterian and Mount Sinai right here. Plus, there are plenty of dedicated medical buildings and landlords that welcome health care providers between 5th and 8th Avenues, so your patients from the area can get to you easily. And if you like the sound of setting up shop in a ground-floor professional space in a co-op or condo, you’ve got options here.
  • Upper West Side: If you’re a dental practice, therapist, or any kind of doctor and love being in an upscale area, the Upper West Side could be your spot. Plenty of ground-floor spaces offer strong visibility for your medical practice. Plus, this neighborhood is a prime location with its charming streets and proximity to institutions like Mount Sinai West.
  • Midtown Manhattan: If you want to be right in the thick of it all, Midtown’s your place. It offers unparalleled visibility and accessibility and a potential patient population everywhere you look. Many office buildings also cater to healthcare tenants, depending on their specialty. Plus, with large medical centers like NYU Langone and Weill Cornell Medicine just a stone’s throw away, you’re in good company. 
  • Financial District: Downtown, specifically the Financial District, is on the up and up and is one of Manhattan’s fastest-growing neighborhoods. That means more opportunities for you. More people are moving in, and they need healthcare services. Plus, you’ve got Beth Israel Deaconess Medical Center, NYU Langone Health, and New York-Presbyterian Lower Manhattan Hospital nearby.

Current Average Leasing Costs for Medical Office Space in New York City

  • Upper East Side: $60.00 to $105.00 per square foot
  • Upper West Side: $55.00 to $90.00 per square foot
  • Midtown Manhattan: $35.00 to $80.00 per square foot
  • Financial District: $34.00 to $75.00 per square foot

What You Should Look for in Medical Office Space 

Searching for the right medical office space in New York City is a big deal, and there’s much to consider. No matter your discipline, you want a spot that fits your unique needs. Let’s break it down.

Medical Office Buildings 

Buildings like these cater specifically to healthcare pros like you. Initially, many served as traditional office spaces, but the trend of repurposing them for medical use is rising. Explore options in Midtown Manhattan and Midtown South, and take a closer look at buildings such as 57 West 57th, 30-32 E 20th Street, and 30 East 40th Street near Grand Central Terminal. You’ll find yourself surrounded by peers in these locations, working in a space tailor-made for your profession. Plus, medical buildings also offer the opportunity for referral from other physicians/healthcare providers in the building.

Mixed-Use Buildings: Flexibility and Visibility

Many mixed-use buildings – those combining office, residential, or retail spaces – are open to medical tenants. Ground floor spaces are common, giving your practice excellent visibility and easy access for your patients. Ground floor space can be a bit pricier, but the trade-off in exposure and convenience can be well worth it. Areas like the Upper West Side, Murray Hill, and City Hall/Tribeca have fantastic options.

Medical Office Condos and Cooperatives: Invest in Your Space

While many businesses prefer leasing, buying a condo or co-op could be wise for medical practices planning to stay put long-term. You’ll have to fit out the space yourself, but this could be a wise investment down the line. And if you’re a physician? Purchasing a space makes sense. Square footage and space requirements don’t usually change over the years. Plus, it’s particularly challenging to relocate a medical practice once patients become like family and get used to your location.  

Addressing Unique Needs: More Than Just Square Footage

Medical practices have specific needs. Think beyond square footage and employee headcount. Consider the number of exam rooms, treatment spaces, and the necessary equipment you’ll need. Surgeons might need recovery rooms; psychiatrists might need soundproofing. Dentists need plumbing in every operation room. Making your space ADA-compliant could be crucial, depending on your patient base.

Your utility needs are unique, too. Ensure the electrical infrastructure can handle your equipment, and check if there’s a backup generator in the building. And don’t forget about the importance of natural light, especially for specialties like psychiatry.

Female dentist in blue coat smiling at camera in a modern dental office

The Challenges of Leasing Medical Office Space in New York City

  • Steep Rental Prices: Let’s talk numbers first. New York City isn’t cheap, and this is particularly true when it comes to renting medical office space. Balancing a hefty rent can be a tricky endeavor for a medical practitioner aiming to offer competitive prices. You want to provide the best care in an upscale office that’s convenient for your patients. But you also need to make sure your practice generates a reasonable profit each month.
  • Making the Most of Your Space: As a medical practice, you have specific requirements – plumbing, electrical, custom cabinetry – things other businesses just don’t think about. You also need the right amount of space for exam rooms, waiting areas, administration, and more. The good news is, some landlords out there will work with you to customize the build-out so your new space is efficient and functional. They’ll help optimize the layout so you maximize every square foot to benefit you and your patients.
  • Competition and Market Saturation: New York City is a melting pot of medical practitioners from all specialties. Standing out in such a saturated market is a challenge. You need a space that serves your operational needs and helps establish a strong brand presence. Tell your realtor if this is an issue. If you have a competing practitioner in the same building is that OK? What about the same block? 
  • Accessibility and Convenience: Your patients’ needs come first. Selecting a location that is easily accessible via public transportation or has ample parking space is essential. It’s all about making your patients’ visits as smooth as possible. After all, nobody wants to deal with the chaos of New York City traffic or spend hours hunting for a parking spot before a medical appointment.
  • Aging Infrastructure: Many buildings in New York City have stood for decades. While they may have historic charm, they might not be able to handle the modern needs of a medical practice. So, ensure that the infrastructure can support your state-of-the-art equipment and technology. You wouldn’t want to compromise on the quality of care you provide due to power outages or plumbing issues.
A young nurse is using a digital tablet in a hospital. She is wearing a blue scrubs and has a friendly smile.

Top Considerations Before Signing a Medical Office Space Lease

  • ADA Compliance: Put yourself in your patients’ shoes. Is the space easily accessible, even for those with limited mobility? Make sure the medical office adheres to the Federal American Disabilities Act (ADA) guidelines. It’s not just about compliance; it’s about caring for every patient who walks through your door.
  • Infrastructure and Amenities: Pay close attention to the essentials like electrical and HVAC systems. If you see patients after hours and on weekends you may need tenant-controlled HVAC that can run 24/7. Don’t forget about specialized plumbing and waste disposal provisions, either; these are critical for a medical space. Remember, not all costs might be covered by landlords, so a space with extensive plumbing could save you big bucks.
  • Creating a Welcoming Space: Your waiting and reception areas are the first things patients see. Make them feel welcome and safe. A visually appealing, comfortable waiting area can genuinely enhance the patient experience. Think about privacy and safety too; these are non-negotiables.
  • Safety and Security: The safety of your patients, staff, and yourself should always be a top priority. Look beyond the office space itself. How secure is the building and neighborhood? Make sure you’re setting up shop in a place where everyone feels secure.
  • Don’t Forget About Parking: Manhattan and parking can be a tricky combination. Research nearby parking garages ahead of time. Make sure there’s enough space for your medical staff, patients, and any visitors. It’s a seemingly small detail that makes a world of difference.

Ready for More Insights?

Since 2004, our team has represented hundreds of tenants in acquiring commercial loft space and office, retail, law firm, and hedge fund space. Contact us at (212) 444-2241 for any questions. 

Frequently Asked Questions

Do New York City landlords build out medical spaces for physicians and healthcare providers?  

The owners of buildings that cater to medical tenants are more open to building out a medical space on behalf of physicians and healthcare providers. They will usually provide architectural planning services, file permits, provide plumbing and electrical distribution, and build treatment rooms, consult rooms, a reception area, and ADA-compliant bathrooms. Typically, they will build to a cap with the tenant paying additional costs above the agreed-upon build out allowance.

Does your medical practice require an ADA-compliant building and space?   

If you require an ADA-compliant building and space, this is a key factor to consider when searching for a new space. Your realtor will then screen properties to show you based on these criteria. Some properties are partially ADA compliant, fully ADA compliant, or not at all. It’s also possible to retrofit some spaces to be compliant. For instance, if you construct an ADA-compliant bathroom within a space. Physicians should check if insurance companies require them to lease an ADA-compliant space.

Do you need to dispose of medical waste, and if so, does the landlord offer biomedical waste disposal for your practice?   

Many medical practices generate bio-hazardous waste, and it requires proper disposal. Ensure that your broker shows you properties with bio-hazardous waste disposal services. Dedicated medical buildings are most likely to offer these disposal services.

Does the space offer sufficient electrical distribution for medical equipment?

Medical procedures may demand medical equipment with high-capacity electrical distribution. Do you need two-phase or three-phase electrical distribution for your practice’s equipment? By communicating your practice’s electrical capacity needs to your real estate broker, you ensure they only consider spaces with adequate energy or the potential for upgrades.

Does the space offer sufficient plumbing capacity for healthcare practice treatment rooms and operatories?   

Medical space requires sinks and other plumbing in treatment rooms and operatories. Dental practices require extensive plumbing with water running to chairs. Be sure to consider plumbing requirements when searching for a new space.

Does the property offer sufficient HVAC capacity?   

Your practice may use equipment such as lasers that generate heat and require cooling. In such a case, you may need additional HVAC capacity to provide additional cooling, which may be required 24/7. Take this into account when you search for a medical office.

What hours is the building lobby attended, and is your space accessible to greet patients for early morning after-hours and weekend appointments? 

Suppose you lease a ground-floor professional medical space with a private entrance facing the street. In that case, you will have 24/7 access, so this is not an issue. But if you have an above-grade space in an office building, it is critical to check what hours someone attends the lobby and when you have access. Most dedicated medical buildings offer 24/7 access.   

Are there other healthcare practices in the building, and could they be a source of patient referrals?  

If patient referrals from other practices are a viable source of income, consider leasing space in dedicated medical buildings where other tenants can refer patients to your practice.