What if I told you the most expensive part of your lease… isn’t the rent?

It’s the clauses you didn’t know you were supposed to negotiate

A med spa owner signs a 7-year lease. Business grows. She needs to expand into the adjacent suite. But her lease has no expansion rights, no right of first refusal, and no early termination option.

The landlord knows she's stuck. His offer for the adjacent space? 40% above market rate.

This scenario plays out across the wellness industry every day. According to healthcare real estate attorneys at Epstein Becker Green, tenant improvement allowance provisions alone are a major negotiating point that tenants frequently miss—leaving significant money on the table.

The problem isn't that wellness providers are bad negotiators. It's that they don't know what to negotiate for.

Here's how to change that.

Landlords love wellness tenants. You're paying 15-25% above traditional retail rents, you invest heavily in build-outs (which increase property value), and you sign longer leases than most commercial tenants. Healthcare REITs report 92%+ occupancy rates for healthcare providers.

In other words: you have more negotiating power than you think.

Most wellness providers approach lease negotiations assuming they should be grateful the landlord will rent to them. That's backwards. The landlord wants you. Your job is to make sure the deal reflects that reality.

Wellness build-outs are expensive. Med spas run $250-400 per square foot. Physical therapy clinics run $150-250. Even mental health practices need $125-200/SF for proper soundproofing and private spaces.

Tenant Improvement Allowances (TIAs) are negotiable—and most wellness providers don't push hard enough.

Here's what to know:

Standard TI ranges for wellness: According to industry guides, medical office tenants can request $30-80 per square foot, depending on market, lease term, and tenant credit. For a 3,000 SF med spa, that's $90,000-$240,000 the landlord might contribute to your build-out.

Longer lease = higher TI. Landlords amortize TI costs over your lease term. A 10-year lease typically gets you 30-50% more TI allowance than a 5-year lease. If you're committed to the location long-term, use that as leverage.

Negotiate what the TI covers. Some landlords limit TI to "permanent improvements" only. Push for broader coverage including architectural fees, permits, and specialized infrastructure (plumbing for med spas, HVAC for fitness, soundproofing for mental health).

Watch the disbursement structure. TI can be paid upfront, in draws during construction, or upon completion. Upfront or progress payments help your cash flow. Completion-only payments mean you're funding the build-out yourself and waiting for reimbursement.

Beyond TI, these are the clauses that separate good leases from expensive mistakes:

1. Exclusivity Clause

This prevents your landlord from leasing to competing wellness businesses in the same property or complex. If you're a med spa, you don't want another med spa opening two doors down.

Be specific about what "competing" means. "Medical spa" might not cover an IV therapy clinic that also offers aesthetic services. Define the services you're protected from, not just the business type.

2. Right of First Refusal / Expansion Rights

If you might need more space in the future, lock in your options now. Right of first refusal means the landlord must offer you adjacent space before leasing it to someone else—at the same terms they'd offer that other tenant.

Better yet: negotiate expansion rights that let you take adjacent space at pre-negotiated rates, regardless of market conditions.

3. CAM Caps

Common Area Maintenance (CAM) charges cover shared expenses: parking lot maintenance, landscaping, security, property taxes, insurance. These costs can creep up over a long lease—I've seen 15-20% increases in a single year when properties change hands.

Negotiate a cap on annual CAM increases—typically 3-5% per year. Without a cap, you're exposed to whatever the landlord decides to charge.

4. Co-Tenancy Clause

This protects you if the shopping center's anchor tenant leaves or major tenants vacate. If 30% of the center goes dark, you shouldn't be paying full rent while foot traffic evaporates.

A strong co-tenancy clause lets you reduce rent (or terminate the lease) if occupancy falls below a certain threshold.

5. Early Termination Option

Sometimes things don't work out. Market shifts, business model changes, or personal circumstances might require you to exit early. An early termination clause gives you an out—typically after a minimum period (3-5 years) and with advance notice (6-12 months).

Yes, you'll usually pay a penalty. But that's far better than being locked into a 10-year lease for a location that's no longer working.

Healthcare lease negotiations are complex, and the details can cost you six figures if you miss them. Here's what to watch for:

Personal guarantees. Many landlords require business owners to personally guarantee the lease. This means if your LLC fails, they can come after your personal assets. Negotiate to limit the guarantee period (first 2-3 years only) or the amount (capped at 12 months of rent).

If you're planning to sell your business someday, PE buyers won't assume your personal guarantee. Get it removed or limited before you're ready to exit.

Assignment and sublease restrictions. What happens if you want to sell your practice? Can you transfer the lease to the buyer? Push for broad assignment rights with landlord consent "not to be unreasonably withheld."

Rent abatement during build-out. You shouldn't be paying rent while you're spending $200,000 building out a space you can't use yet. Negotiate 2-4 months of rent abatement during the construction period.

Renewal options. Lock in your right to renew—and ideally, cap the rent increase at renewal. A clause that says "renewal at fair market value" sounds reasonable until your landlord decides "fair market value" is 25% higher than your current rent.

The single most powerful negotiating tool? Alternatives.

Never negotiate a lease without at least one other viable option. That might be another property in your target area, a renewal at your current location, or the possibility of purchasing instead of leasing.

When a landlord knows you have options, everything changes. Suddenly TI allowances increase, exclusivity clauses appear, and CAM caps become negotiable.

Even if you've found your dream location, tour other properties. Get proposals. Let the landlord know you're evaluating options.

After 26 years in healthcare, I've seen the same lease mistakes repeated across every wellness category. Providers sign documents they don't fully understand, accept terms they could have negotiated, and pay for it—literally—for years afterward.

The asymmetry is real. Landlords negotiate dozens of leases a year. You negotiate one every 5-10 years. They have professional representation. Most wellness providers don't.

At minimum, have a commercial real estate attorney review any lease before you sign. The $1,500-3,000 you spend on legal review can save you six figures over the life of a bad lease.

Your lease is one of the largest financial commitments your wellness business will make. Don't approach it casually.

→ Download the 2026 Wellness CRE Playbook

Includes site selection frameworks, market analysis by region, and financial benchmarks for every wellness category.

→ Book a lease review consultation with Leigh

If you're negotiating a new lease or approaching renewal, I'll review your terms, identify gaps, and help you negotiate from strength.

Until next week,

Leigh A. Brower

Fractional Chief Real Estate Officer The Next Gen Dev | The Wellness Edition

The Next Gen Dev - Wellness Edition is your weekly briefing on the strategies and frameworks that separate wellness businesses building the future from those stuck in the past.

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