The Challenge

Clearway Pain sought to expand into a new market as part of their practice growth. We identified an excellent sublease opportunity previously developed as a clinical suite by the University of Maryland Medical System (UMMS), which met Clearway’s clinical requirements. In addition, there was an adjacent shell space available for sublease that could be developed into an Ambulatory Surgery Center (ASC), addressing Clearway’s need for such a facility. However, the sublease term had only six years remaining, which was insufficient for Clearway to invest in building an ASC.

In addition, The Medical Pavilion at National Harbor, had paid parking, which the Tenant saw as an issue for patients and staff since all of their other locations in the market had free parking.

Our Approach

To resolve this, we worked with the landlord's broker to structure a new market lease that would commence six years later, extending the total lease term to 12 years. This arrangement provided Clearway with the security they needed for long-term planning.

We worked with the sublandlord's broker to help offset parking expenses, which directly affect the bottom line. The parking garage was owned by a 3rd party so we couldn't negotiate directly. Therefore, we looked at all of the sublease terms as an opportunity to negotiate.

The Challenge

The two-story retail space was physically and financially distressed and required exterior and interior renovation. While the total building's net rentable area is 21,965 square feet, at the time of acquisition 15,019 square feet was either vacant or rested at below market rates. Existing layout did not have enough contiguous space for Montgomery Family Medicine, although the total property size was four times what the practice anticipated purchasing. A recently constructed traffic median impacted north bound Montgomery Rd. access, making retail trade more difficult.

Our Approach

Dan McDonald found multiple locations that would be suitable for their practice. However, the expense of a single-occupant building did not yield the desired financial returns. Mr. McDonald suggested a high-visibility, multi-tenanted property that could meet the needs of the practice and create positive investment value for the physicians and their partners. Lee & Associates brought in additional equity investment partners to help the client secure a loan of $2.7 million. Coordinated more than $1 million in total exterior and interior renovations. Found new locations and negotiated leases for existing tenants who needed to be relocated. Negotiated four new leases and extended two existing leases to reach 100% occupancy within nine months of the purchase.