Learning the Real Estate Side of Dentistry

Hey, dental associates and new practice owners. Welcome to the Associates on Fire podcast. Powered by Practice cfo. This is the podcast that teaches you what you never learned in dental school, the financial side of dentistry. We cover topics from planning for ownership, buying a practice, to student loans, taxes, and all things financial for the hungry to learn Dental Associate. So let's light it up.

Welcome back everyone, to the Associates on Fire podcast. My My name is Drew Phillips and I will be the host of today's episode. For those who haven't had a chance to check out our Associates on Fire program yet, I'm a CPA and CFO advisor at Practice CFO and one of the instructors in our Associates on Fire program. Be sure to check us out@asschoolsonfire.com today. I'm excited to introduce CEO and founder of Carr Healthcare Realty, Colin Carr. During my time in the private medical space, I've noticed a massive void in the industry around successfully navigating lease renewals and analyzing commercial real estate ownership opportunities and the ability to bring all facets of the real estate side of dentistry into a clear, comprehensive plan. We all have stories or know someone with the story that's faced a predatory landlord or had a lease negotiation gone awry. Which is why I feel fortunate to have met Colin and his team at Carr Healthcare Realty. So without further ado, let's jump in and hear from Colin Carr. Welcome, Colin.

Thanks for having me, Colin.

Give our listeners a quick background on how you found your way into the real estate industry and how you came to found Car Healthcare Realty.

Yeah, absolutely, man. So I, I took a little bit of a different approach. I got involved in real estate at the age of 19. I met a gentleman that was managing apartment complexes, started shadowing him and fell in love with real estate. So started managing apartments when I was 19 back in Michigan, moved to Colorado in my early 20s, came to kept managing apartment complexes and then I got into brokerage. When I was 23, I met a gentleman that represented a lot of large national retailers, Walmart, Wendy's, Blockbuster, and had a outstanding chance to go work with him and learn the commercial real estate industry. I moved into more office and industrial a couple years later and the long story short is I started doing medical and dental deals. I started listing medical and dental properties and, and after a very short period of time doing that, I witnessed firsthand how many doctors were getting just absolutely destroyed in negotiations with landlords. I watched doctors come in that were super intelligent, very savvy when it came to their clinical side. The healthcare Side, when it came to the business side, they did not have a clue what they're doing. And I watched a handful of landlords just literally manhandle these doctors to to where they were spending an extra 100, $200,000 more on a lease than they should have if they knew what they were doing. And of course in some of those scenarios I was working on the landlord side. So I had a fiduciary to help the landlords get the best terms possible. And I just realized that these doctors need someone to protect them. So I made it a target and a goal of mine to start helping more healthcare providers. I started doing a lot of tenant buyer rep on the healthcare side and after doing that for a short period of time, I saw a very clear lane of starting this company now, Car Healthcare Realty and having the double niche or the exclusive focus of only health care and only tenants and buyers. So we launched that in 2009 and was met with tremendous success and feedback. We did hundreds of transactions throughout Colorado the first several years and then in 2014 we launched and started going into other states. Today we're in over 40 states across the country. We represent thousands of healthcare providers every year with their real estate and our exclusive focus is protecting healthcare providers and their real estate negotiations.

I love that you have a dual niche in that you're focused on healthcare and you're only representing the buyer and leasee side of the transaction. I spend 99% of my time on the buy side and I have countless stories of landlords doing exactly what you just went over, imposing their will on tenants and locking them into leases far outside of market rates. Colin, give us your thoughts on why is commercial real estate so important to dentists and how does your team get involved?

Well, the reality is if you are a dentist, unless you have a mobile practice, which is pretty rare these days, you got to have an office space. You're going to have either a lease agreement with a third party landlord or you're going to buy the real estate. And the reality is, if you're in a lease situation, the difference between a properly negotiated lease agreement and a poorly negotiated lease agreement, it can easily be tens to hundreds of thousands of dollars. And people hear those numbers and they think, oh, that sounds a little exaggerated or is there really that much on the line? And the answer is yes. I mean, just break down the numbers. If you lease a 2,500 to 3,000 foot space, which is a fairly standard space for a lot of dentists, and if you overpay by an extra $2 or $3 per square foot, that's an extra, you know, five to $9,000 per year that you're paying, depending on the size, depending on the rate, etc. That you could have avoided if it was properly negotiated. You take, you know, again, somewhere in the middle $7,500 per year times 10 years, that's $75,000 in extra rent that you could have avoided paying if you knew what you were doing and had proper representation.

And that's just in principal payments. If you factor in what that would have done in the markets compounded over 10 years, you're looking at close to double that amount, if not more.

Absolutely. And then you get in concepts like, you know, free build out, free build out period, or free rent. Once you open, did you get the three or four months free that you should have if you were doing it properly? You might lose another 15, 20,000 there. Did you get the right tenant allowance? Landlords give money to tenants to lease their space and commit to long term leases. It's very common to get a landlord to give somebody, you know, 25, 35, $45 per square foot for a long term lease. You can leave 100, $200,000 on the table or any variation in that area very easily. Also then you get into concepts like operating expenses, annual increases, there's all sorts of areas where you can leave money on the table. The reality is it's typically somewhere between 100 to $200,000 that either can be won in your favor or lost in and in the favor of the landlord. And that's a significant amount of money that's either coming into your pocket or staying in your pocket or going into the landlord's pocket.

In a few instances, I have worked with the dentist who had buyer representation during their lease negotiation. In my opinion, it didn't go as I felt it was supposed to. And when I look at the dental industry at large, there's this underlying feeling that hiring someone to handle their lease negotiations will potentially produce a worse scenario than than they would have otherwise be if they would have allowed the landlord to go through with their originally intended proposal. I think the reason for this is that dentists are scared. Scared they're going to piss off their landlord and potentially lose out on the office. That they've spent a ton of money in leasehold improvements. And I don't blame them for having these trepidations. But after meeting you and learning about the car strategy, I'm confident that my few experiences are not a representation of what's possible. So elaborate and help our dentists out there understand the difference between the agents that are I and many out there have worked with and your team at Carr Realty.

Well, there's no shortage of real estate brokers or agents that are not savvy to the health care industry. They don't understand it. They want to treat a dentist the same way they treat an auto repair shop or a traditional office user or a restaurant. And there's huge differences. And so if you get a, if you get a real estate broker agent that doesn't understand health care, doesn't understand dentistry, or a lot of brokers don't do tenant and buyer repair, they'll take a tenant and buyer deal as a chance to try to earn a commission or get in front of more landlords. But they might get 95% of their of their income from doing landlord work. So some of the questions you need to ask, first of all are how much of your business is comprised of landlord and seller work versus buyer or tenant work? And that's going to be a huge eye opener right there. If you get someone that does two or three tenant and buyer rep deals per year, they're probably not going to be even close to as good as someone that does their entire business or dozens of deals on that side. The next question is how much health care do you do on an annual basis? And then same thing. Are you on the landlord side? Are you doing on the tenant buyer side? If you get down to those questions, you're going to get a lot closer to someone who can actually help move the needle and understand your industry. It's not the exact analogy, but it's the idea of saying, well, yeah, I'm a doctor, but yeah, are you a chiropractor or are you an endodontist? There's a difference. Why do real estate, okay, are you a residential real estate broker? Are you commercial? If you're commercial, are you a landlord broker? Are you a tenant broker? And then do you have health care experience? And again, I mean you can get as niche as you want to in any industry. But when it comes to real estate, there's a lot of different specializations. You know, selling a multi family apartment building is very different than helping an endodontist lease their first space. There's a lot of differences. So there's a lot of brokers that try to be the jack of all trades, master of none and they can get a transaction closed, but they don't have the expertise to move the needle and to protect the doctor. The way that they need to be protected. So I think asking those questions really helps to get to the place where, you know if the person that you're talking to is qualified or if they're not qualified. If they are qualified, the odds of them hurting the deal or getting you a worse transaction are extremely low. That that broker agent's job is going to be to protect your interest, to make sure that the landlord doesn't take advantage of you. And you can do that in a number of ways. If that. If that broker that's working with you doesn't have any conflicts of interest, they're not trying to get a listing from that landlord or they're not working for other landlords in the area to where they can't give you an unbiased opinion. They're going to go to the market, they're going to do the due diligence and research and they're going to tell you this is what a market lease rate looks like. If you wanted to look at other properties, here's three or four other properties that make sense. If you want to purchase real estate, here's your options to buy a condo or building or to buy land and develop it. And they're going to comprise all the information and they're going to arm you with data and numbers so you know whether or not you're getting a good or bad deal.

That's a great segue into my next question. From start to finish, what does the process look like? Say I'm a dentist, I'm 10 years into my lease agreement, I'm out of options to extend. My landlord is trying to raise my rent by 7%. So I've decided to call Carr Healthcare Realty. Walk me through what that's going to look like. From start to finish, you engage the agent.

The first thing the agent's going to do is take a look at your current lease agreement and they're going to analyze it, they're going to make sure that the dates are right, that the terms are what you think they are. They're going to see if you have renewal options or not. Just because you have a renewal option, by the way, does not mean you're going to exercise it. It's very rare that we're actually exercising a renewal option. And the question why not? The reality is because that renewal option typically has an annual increase built in which automatically bumps the rent higher. It usually has no mention of concessions like free rent, tenant improvement allowance, resetting base years for operating expenses usually is void of all those concepts. So Your traditional renewal option basically just bumps the rent a couple of percentage points, gives you nothing, and you leave 100, $200,000 on the table. So we look at the lease start there, and then the first thing we do is we do not call the landlord and start, you know, negotiating. Because if you just start negotiating with the landlord and you haven't been to the market to verify your options, you're really just, you're just, you're, you're bartering or begging or bluffing like you don't know what you're comparing it to. You've got to then go to the market, figure out what are your options. If you wanted to relocate, what are other landlords in the area willing to do for you? How many other options do you have? Do you have two or do you have 20? If you wanted to purchase real estate, how do those purchase opportunities compare to the lease opportunities? What's the brass tax? What's the before tax benefits, after tax benefits, after principal pay down? How does a lease compare to the purchase? And then you run all these numbers and data, you show the client, you show the doctor what other options are available, you educate them, and then when it comes time to call in the landlord, you're fully armed with all the market information and data. And that's a different approach. Most, most real estate brokers will just take a shot at a landlord and just ask for lower terms, ask for higher concessions, and they're, they're not doing it factually, they're just literally shot in the dark. It's, it's, it's ready, you know, actually shoot in that. Aim, Ready, fire, aim. You gotta go. Yeah, you gotta go to the market and figure out what are you comparing it to. If you have no options and you can't move and there's nothing even close and you have a good deal, you don't ask the landlord for a lower lease rate. If you do that, you look like you have no clue what you're doing and you're going to get, you're going to get penalized for that. Conversely, if you're, if you're $7 a foot above market and you've got three other landlords that would compete for your business and drop your rent considerably and pay for half of your build out. If you want to move, give you a huge free rent package to offset all your living costs, you can get a lot more aggressive with that landlord because it's a factual negotiation. And the difference summary of all this is most brokers don't go to the market and do the due diligence research. They don't educate the doctor. They just take a shot in the dark and they get penalized for it.

Right.

That's been, my experience, is very passive in the way that they try to help people. Okay, so now you've armed these dentists with, with all this data, all this firepower to go back to the landlord at that point, are you, are you handing over the reins back to them? Are you helping them in those actual negotiations?

Yeah, you got to have the broker that takes care of this for the doctor. And there's a number of reasons. Number one, one of the top reasons that you hire a broker is because you don't want to deal with it. You don't want to invest 30, 40 hours of your time. You want them doing it. The second thing is you can't be in, in the middle of your own negotiation. You don't have the ability to stand firm and create a posture for yourself unless you're really, really good at it. Very few people are. And so the reason you have someone representing you is because you want them to take the brunt of the conflict, the confrontation. They're fine getting uncomfortable with the landlord when, when the doctor's there, they're going to have a very hard time holding that line. And landlords know that. So when they're talking to a doctor, they love to make it uncomfortable. They love to make it to where the doctor says, I don't want to deal with this anymore. I don't like the way this feels. I don't want to be involved in this. The landlord knows that. They pry on that as far as making that a part of the negotiation. So you don't want to pass this over to the doctor. You want to keep an agent who's, who's handling the whole process for you. And then they create the posture, they handle the negotiation. And it's the same thing that every successful company does. Every Fortune 500 company has either a team of in house professional real estate brokers that handle this and all they do is negotiate for a living, or they hire professional brokers on the outside that all they do is negotiate for a living. No, no Fortune 500 company is having some random person who does a lease every five or ten years handle the deal. It doesn't happen that way. And yet these doctors that have done no leases, or one or two, the landlord knows that that person has not qualified. They know that they don't know the market. They know that they don't understand what it means to create posture and have a strategy. And they know that they're typically just bluffing. And they know that because if a doctor is handling their own negotiation, they're not serious. If they were actually out there looking at four or five other properties, negotiating, running comparisons, doing due diligence, there's no way they have the time and the savvy to do that. So when a doctor talks to a landlord directly, especially in a lease renewal, that landlord will bet 99% of time that doctor is not going anywhere. And then you end up in a place where, yeah, the doctor then is trying to convince the landlord something that's not going to happen is not true and the landlord is going to penalize them for that in the form of much higher lease rates, virtually no concessions, and it's not going to go favorable.

I completely agree. Negotiation is an art form. It sounds like you guys are an end to end service provider in this space. So I'm a dentist coming up on a lease renewal where I just need to understand my real estate options in general. And I'm listening to this right now and I love what I'm hearing. I just want to know, how are you paid in this space and what will it cost me to use car realty services?

Yeah, that's one of the best things about hiring an agent or a broker. If you're a tenant or buyer. Commissions in commercial real estate are always paid by the landlord or seller. Meaning if you're a doctor, you're a tenor buyer, you never pay a commission. It's just like residential real estate. If you're a buyer and you're going to go buy a house, you don't pay your agent to represent you. They take half of the listing commission that the seller agreed to pay their agent. So in commercial real estate, the landlord of the seller hires an agent or a listing broker, synonymous, same thing, and they agree to pay them a commission. And that commission is built for two people. If the doctor shows up without an agent, the listing broker gets a double commission. If the doctor shows up with an agent, they split the commission down the middle and it doesn't cost the doctor a thing. Now a lot of doctors have a wrong understanding. They think, well, if I don't use a broker, I'll save money. But that's completely flawed because they're not determining the commission structure number one, and they don't control the checkbook or the check that's getting cut towards that broker. So when a doctor shows up and says, I'm not going to use A broker because I want to save money. The listing broker gets a double commission. Now will the listing broker tell the doctor if you don't have an agent, we'll give you a better deal? Absolutely. Is that actually happening? No. They're just playing the doctor for the fool and the landlord loves it. Landlord doesn't care. They've already agreed to pay a certain amount of money. They don't care if there's one broker or two from the commission standpoint. But the landlord is highly motivated to have the tenant, the doctor not have a broker because they know for a fact that Dr. Is going to take an inferior deal. They don't have the savvy, they don't have the market intelligence, they haven't done the due diligence. They can't create the same strategy and posture and they're not going to be successful at holding firm or pushing back the way that an agent would be able to on the doctor's behalf. So the landlord will tell that the doctor will give you a better deal if you don't have an agent. The listing broker will tell the doctor the same thing. Each one has an agenda. The landlord wants to get a better deal for themselves and they want the doctor not to know the difference, not to know better. And then the listing agent wants the doctor not to have a broker because they want a double commission. It is a win win for the landlord. Listing broker is a complete lose lose for the doctor.

When I'm talking to a dentist that is purchasing a practice and they're building that team out around them, I always tell them to understand the financial incentives of each person on that team. Super important. Okay, let's shift gears just a bit here. You're working in 40 states and you have an intimate understanding of the commercial real estate market at large in this country.

What states or areas do you see.

That show the most fruitful opportunity? Maybe I have a young dentist that just wants to maximize their 10 to 15 year practice ownership journey before retiring at an early age or maybe at that point moving to a more desirable area.

Yeah, I think there's opportunity across the country. I know that might seem like a cliche answer, but there really is. I mean, there's tremendous growth and dozens of major markets across the country, older, more established markets that are a lot tighter. In the real estate market, there's still tremendous opportunities there because there probably hasn't been as many startups or new practices opening up or additional locations. So whether you're, you know, whether you're in a market with 56 million people, like a Houston or a Dallas, you know, or you're somewhere rural in Oklahoma. There's opportunities across the country. The good news right now, if we're talking about, you know, where we, you know, end of 2020, beginning of 2021, you can get a better deal today than you could have. Pretty Covid, believe it or not, people want to know the question of, you know, where's the market today with COVID Here's the reality. Landlords have lost a lot of traditional office tenants and retail tenants. They're, they're bracing to lose more when it comes to the healthcare industry. It's, it's surviving, it's finding a way to win. It has the last five economic recessions, in fact, the last five economic recessions, healthcare and healthcare real estate has been the strongest sector of any form of commercial real estate. So doctors find a way to survive. They find a way to get through it. They even find a way to thrive. And so what you have is landlords that are losing tenants that know they're going to lose even more tenants and have more vacancy coming up. And then they see the doctors that are there, they want to make those deals, they want to bet on that doctor being there for the next, you know, 5, 10, 15 years. And so they're willing to stretch further to make a deal with a dentist or a veterinarian than they would a restaurant or some other retail use or some other office use. So there's a, there's a phenomenal period right now to get better lease rates than you could have 12 months ago, or really the last two to three years for that matter, to get higher concessions, like a higher tenant, proven allowance, more free rents, to get terms that are more flexible and more in your favor if, if you're properly represented. And you can get a better deal today than you could have 12 or 24, even 36 months ago. And so from that perspective, there's a lot of opportunity right now. There's certainly challenges, but there's a lot of opportunity.

As an outsider looking in, I see general use commercial real estate taking a hit because of COVID Not to mention now we know we can work remotely in many industries, and the industries that can do it successfully are likely going to want to save the 7 to 12% they were spending on rent and other facility expenses. But when it comes to dentists, they're never going to be able to pull a tooth remotely. I mean, I mean, maybe, but that would be in the very distant future. So I see what you mean by dental and medical practice owners having a lot of leverage over landlords and likely they have more negotiating power than they thought before listening in this episode. So, Colin, in general, when you're analyzing a market and preparing your data sets for lease negotiations or property purchases, are there certain markets more right for purchasing as opposed to leasing?

Yeah, that's a good question. So the idea of, you know, are there viable options to purchase, that's a good question. It is different across the board. So I'm in, I'm in the Denver metro area in Colorado. I'm in the south side of town. I'm in the Lone Tree, Castle Rock area and growing suburbs, lot of growth. There's areas where, where our office is located where you might have three or four options to purchase at all times. There's areas where you go two miles down the road where there's never been an option to purchase the last five, six years. So it's really hit or miss. Depending on the market. It depends on how, how close you want to move from your current location. Depends on if there's land available where you could buy a piece of land and develop your own building or, or if you have to try to find an existing building that would sell to you or is for sale. So it's across the board. If you're in an area that has a lot of land available and you can keep stretching the boundary and going further out, your options of owning are going to be much higher and you're going to probably have multiple scenarios of buying an existing building or buying land if you're in a really dense, tight market. If you're downtown Denver as an example, depending on where you're at and what portion of the downtown area you want to be, you might have one option or no options to purchase. It really depends. And then you can get into other parts of markets like you get Orange County, California and certain areas. In Orange county, you might have two or three options to purchase, but the cost might be four or five million dollars for one building and you might not be able to afford it. The best thing you can do is hire a qualified agent that understands again, commercial understands healthcare. It's only working on your behalf. Let them go to the market and they can tell you, you know what, you've got three or four viable options. Here's why they make sense. Let's take a look at them. Or they can tell you you don't have a single option. And I can keep it in mind or I can keep a search and the parameters open so anything pops Up, I hear about it and know about it and notify you. But they can tell you very quickly either yes, you've got some options or no you don't. And the market could dictate for you whether or not you can own or not.

And this may be market dependent as well. But are you seeing a healthy spread between constructing a building and purchasing a building? Like when you look at construction costs per square foot and then you look at the cost per square foot to purchase a building, is there a healthy spread for doctors to buy land and build their own building?

Yeah, there's pros and cons of both. It's going to typically be more, more cost beneficial if you can buy an existing building because construction costs just keep on climbing. They've dipped a little bit with COVID because the, the pipeline has slowed down a little bit and they're projecting to the slowdown further. So a lot of contractors are getting more competitive, subcontractors are getting more competitive. Some commodities costs have come down, some have gone up. You know, we saw steel drop tremendously because oil drops so so much as well. You see that with the price of gas, other commodities have increased in cost because the, the supply chains slowed down during COVID So it's all over the board. But long story short, it typically costs more to buy a piece of ground and build your own building than it does compared to buying an existing building. Unless you're in a super high end area and they're going to charge a premium for that existing building. If you can find a building or a condo that's already built and you can retrofit it, you're usually going to save money over buying a piece of ground and building your own building. However, there's a lot of benefits to buying a piece of ground and building your own building and that you get exactly what you want. You get a brand new, state of the art building with the exact aesthetics, colors, window lines, ergonomics features, you get everything you want. It's like building a house. You can do it from scratch and everything is the way that you want it. And that's, that's typically worth it for a lot of people. So if you want a brand new building that's available to you, that's an amazing opportunity. If you can buy an existing building and save a significant amount of money, then that's great too. But really saving, you should be doing a purchase versus purchase analysis. Buy an existing building, retrofit it versus buying a piece of ground and building it from scratch. You, you can run A detailed purchase versus purchase comparison. And if, if there's no difference, then you pick which one's more desirable. If there's a big difference, you can shade one way or the other. And even if it costs more money for a new build, you might say, hey, you know what, it's worth it, it cost me an extra half million as an example. But over 20 years, that's, you know, a certain amount of money per month. And, and, and that might be worth it for you.

Yeah. And I was telling Colin when we were first, when we first met, you know, taking that analysis and layering it into our dentist sort of global long term cash flow plan is super important. Especially when the money or the, the, the least the purchase to purchase or lease first purchase options aren't giving you a clear financial answer.

Being able to layer that in and.

Understand what the consequences or opportunity will be for them long term is helpful. Okay, so what about converting then a general use space or maybe even a residential space? What does that process look like? And is that an opportunity that you guys explore as well?

Yeah, converting residential to commercials is pretty rare. It happens in some areas, but it's pretty rare. You get in a lot of zoning issues. You get a lot of things where the, with the, usually the home isn't laid out, the ceiling heights, the, you know, the hallways. It becomes more challenging taking a traditional office building, your retail building, and then scraping and cleaning building out a dental office. That, that's an everyday process. And you know, you're looking at, you're looking at the shell of the space. We don't really care what's inside. The restrooms are in a certain place, that's great, but we're probably going to maybe use one and then, and then relocate another one somewhere else. But basically you're walking in there saying, all right, well what's the window line look like? What's the entrance, what's the exit? And then you're looking at just scraping it clean. And it doesn't matter if it's a slab on grade where it's concrete on the ground. You know, you, you trench that concrete, run the plumbing lines, repo the floor. If it's on the second floor, you core drill down into the space below it up in their ceiling, run your plumbing lines. It doesn't really matter. The key concept with doing a new office is you need to know your options. Don't fall in love with one property. Don't take the idea where, you know, you say, well, I have to lease or I have to own Or I have to be an office or I have to be in retail. You can have a preference, you can have a desire there, but the game plan is you need to go to the market and look at all your options. Look at options, the lease, look at options to purchase, look at office, look at retail, look at medical office, and then negotiate with three or four landlords simultaneously. That's another huge difference. In residential, you look at houses either online or with an agent. And then when you find a house you want, you submit a contract and then the seller says yes and they sign it. You're under contract and you're in a binding document. You can typically cancel it for different reasons, but you're in a binding, you're in a binding document at that point, a contract. In commercial real estate, it's common to negotiate with three or four landlords or sellers simultaneously and you do it in a non binding format called a letter of intent or a request or proposal. So in commercial real estate, again, if you're Charles Schwab or you're Lockheed Martin, you're a huge office user, or if you're Chipotle or Starbucks and you're, you know, you've got thousands of locations and you're a retailer, they hire an agent in the market, that agent goes to the market, finds all their options and they start trading paper and negotiating with three or four landlords simultaneously. And they're looking for the best deal. Like they're, they're fishing in three or four ponds simultaneously, looking for the best catch. That's what's happening right there. And you can't, you can't fall in love with a property. You can have your preference, you can hope that this one works out and you might even say, even it's not the best terms, I'll pay more. If it's a better location, that's great. But you need to understand the market and you can't get there if you're doing one property only. You have no clue if it's a good or bad deal. It's like looking at a building, you know, 200 yards away and saying, well, how tall is that building? Is it 10ft or is it 14ft? You can't tell. You don't have a measure to, you don't have the ability to measure that building.

Just, just listening to, to this last bit from you. You know, there's an artistry, I think, in seeing something behind the surface, right? I'm, I'm just a regular guy walking down the street. I, I see a building and that's all I see. You, I can already tell, see past that. You see what the construction costs are going to look like, how the construction may unfold in order to bring that dream to reality. And I think that that's. I mean, a doctor's in doing surgery all day, and they're a clinician and they're great at that. And I think that even at the very least, you know, having someone on your side to see past what's on the surface and, and give them a vision for what's possible in different opportunities is super helpful.

Okay, so before we, before we head.

Out here, Colin, are there any other things that you think are super important for our dentists that are listening here today?

Yeah, I would say just avoid the do it yourself mentality. There's a handful of things that you can figure out how to do it yourself. When it comes to. When it comes to structuring or negotiating a dental lease, I highly suggest that you don't take the do it yourself mentality. If you do, it's probably going to cost you 100, $200,000. When it comes to designing your space, you hire an architect. When it comes to reviewing legal contracts, you hire an attorney. When it comes to, you know, figure out how to hire and train the best staff, you get practice management help. When it comes to figuring out how to run the books the most effectively, how to have the most tax advantage strategy for your practice, for you personally, you hire a phenomenal CPA advisor, etc. It's really simple. The reason patients come to you is because you're trained in a specialty and you can save them a ton of time, save them a ton of pain, give them an outcome that they're looking for. It's the same thing with commercial real estate or any other industry. Don't try to be your own attorney. Don't try to be your own cpa. Don't try to be your own commercial real estate agent. Can you do your own taxes online? Sure. Are you going to lose a ton of money and waste a ton of time? Absolutely. Can you review your own legal contracts? Sure. If you make a mistake, though, you're going to open yourself up to liability of hundreds of thousands of dollars or getting kicked out of your building or whatever it is. It's not worth it. So don't, don't think you're saving money by not hiring people that are highly qualified. It's like saying, well, I don't want to pay a dentist because they're going to charge me something. Yeah, well, you can either fill that to drill and fill that tooth, or you can get a root canal and a crown, or you can get an implant or you can lose it. What do you want to do? And if you don't deal with it, it progresses further and you have a much larger opportunity for either something happening in your favor or dramatically against you. I think that's most important. Don't, don't take the do it yourself mentality.

Get out ahead of it.

Put the right team in place and make it happen.

Okay.

One thing you said real quick before we head out. You, you mentioned contractors and it just signals something in my, in my mind. You know, contractors are hard. Good ones are hard to find. Do you guys have in the States that you're, that you're positioned at least have good contractors that you can help people, connect people with?

Absolutely. Yep. There's no question. And you're right, there's some really good contractors and some really bad contractors. It's the same with real estate. There's some really good real estate brokers out there and there's some terrible real estate brokers. It's no different than any industry. The best way to find good people is to, to talk to people in the industry that have done a lot of deals. I mean, for me, like me personally, I've done, I've done hundreds and hundreds of build outs. You know, we do, we touch a couple thousand deals per year across the country and we know who the contractors are that, that not only pitch you and put together good numbers, but they actually perform and stick to the budget and actually finish the project on time with excellence. It's very different than telling somebody I can do a good job if they don't perform at the very end. Finding a good contractor, finding a good architect, finding a good lender, you know, you've got to find people that are actually going to finish the job. Anybody can tell you they're going to do a good job up front. But having people that you trust, that have a track record that are proven, that can say, here's the last 20 dental offices I've built out, that's what you're looking for. And then you want to go talk to those people. Where are the references? Don't just give me five people that I know are going to tell me you did a good job because they're going to give you their mom, their sister in law, you know, their neighbor. Ask them, you know, ask this question, give me, give me 10 deals you're working on currently and let me go talk to people that you're currently working with. And I love to hear what they'd say about the current process. That's very different than give me a testimonial sheet of somebody who's off. You built out 14 years ago. That was your cousin. And you see that all the time.

Oh, yeah, that's, that's incredible. That's a huge value add, in my opinion. You having all of this knowledge and experience with these contractors who stays on time, who stays on budget, that's, I mean, invaluable information for these guys that are going in. And maybe this is the first time they've ever even contracted with the contractor before. So I can't, I can't stress that, that even in isolation by itself would be an amazing reason to call you amongst the many other things that you guys can do for them in, in their journey and help them save tons of money. I know that, you know, on average, right, 75 to $100,000 is what you potentially could be giving up in savings by not contacting car and not getting them on your team in the lease negotiation or the buying process of your commercial real estate. Well, Colin, man, it was such a pleasure to have you on the show. I, I, you know, I enjoyed our conversation so much. I learned so much. I think that it would be awesome to have you back, back in the future.

I know we're going to get a.

Lot of commentary on this episode and anyway, yeah, I enjoy, I appreciate your time today.

Thanks, man. It's been good to be here.

Okay, well, that wraps up another episode of the Associates on Fire podcast. Don't forget to check us out online at associates on fire.com that is associatesonfire.com until next time.