Quick answer
Medical, dental and allied health practices use property-secured loans to buy their premises, fit out new rooms, acquire or merge practices, buy out partners and fund equipment deposits. Secured over the practice's premises, a principal's home or investment property, these loans can settle quickly when bank processes are too slow, with interest prepaid or capitalised until a bank refinance.
Key points
- Buy the rooms or building the practice occupies
- Fund fit-outs and expansions
- Acquire a practice or buy out a partner
- Equipment deposits for imaging, chairs and surgical gear
- Usual exit: bank refinance once the transaction settles
Healthcare businesses move on property
For many medical and dental practices, property is central to the business. Patients come to a location, specialised rooms take months to fit out and the practice’s goodwill is closely tied to where it operates. Owning the premises protects the practice from rent increases and relocation, and often becomes a significant part of the principals’ wealth.
When opportunities arise, such as the landlord offering to sell, a neighbouring practice for sale or a partner retiring, they often come with tight timelines that bank processes struggle to meet.
How practices use property-secured loans
- Buying the premises. Settling on time when the landlord or a vendor wants a quick, unconditional sale.
- Fit-outs. Treatment rooms, sterilisation areas, imaging suites and accessibility upgrades.
- Practice acquisitions. Buying another practice to grow patient numbers or add services.
- Partner buyouts. Paying a retiring partner their share. See partner buyouts.
- Equipment deposits. Dental chairs, imaging, lasers and surgical equipment.
- Tax and timing issues. Clearing tax arrears or bridging until delayed accounts are finalised.
Security options
Practices frequently own their rooms through a related trust or have principals with substantial home equity. Medical suites in established locations are generally acceptable security, while purpose-built medical centres are assessed case by case because their alternative uses can be narrower. Additional security over a home or investment property can strengthen a deal.
Talk to us about your practice purchase or expansion before the timeline tightens.
An illustrative practice purchase
Illustrative only. A dental practice has leased a ground-floor suite in a suburban shopping strip for many years. The landlord offers it to the principals off-market, on a five-week settlement. Their bank is supportive but needs updated accounts and a valuation that will take eight weeks. A private first mortgage over the suite, with a second mortgage over one principal’s home, settles on time. When the bank’s approval arrives, it refinances the suite and the private loans are repaid.
Regulation and ownership
Some health professions have rules about who can own or control a practice, and practice acquisitions may involve transferring provider arrangements, licences and patient records. Build these into the timeline and get advice from your professional body and lawyer.
Common mistakes
- underestimating fit-out costs for specialised rooms
- buying premises without checking zoning and parking requirements
- acquiring a practice without verifying patient retention assumptions
- leaving partner buyout funding until the retirement date
Exit strategies
Most practice-related private loans are repaid by a bank refinance once the transaction settles and the bank completes its process. Other exits include the sale of a property, practice profits over the term, or the sale of the practice itself.
Questions practice owners ask
Can the loan be in the service entity’s name? Many practices use service trusts or companies; the borrower is usually the entity that uses the funds, with related entities providing security. Your accountant can confirm the best structure.
Does GST apply to buying practice premises? It depends on whether the sale is a taxable supply or a going concern. Check with your adviser.
Equipment upgrades and technology
Modern practices invest heavily in imaging, digital records and treatment technology. Equipment finance suits many purchases, but where a practice wants to fund several items, a fit-out and working capital together, a single secured loan can be simpler and faster than several separate applications.
Practice groups and multi-site growth
Practices growing into groups face repeated funding needs: each new site needs a fit-out, equipment and working capital before patients build up. A secured facility planned around the group’s growth, with property security from existing sites or the principals, can fund expansion without draining the cash that keeps existing sites running. Lenders look for a track record of new sites reaching profitability, so document how earlier openings performed.
When accounts run behind
Busy practices often finalise accounts late, which can stall bank applications at critical moments. A private loan can settle the transaction now, with the bank refinance completed once accounts are lodged. Plan the refinance with your accountant from the outset so the timing works.
Medical centres as investments
Some principals buy medical centres as investments, leasing rooms to other practitioners. These are specialised assets; lenders assess tenant mix, lease terms and the centre’s location carefully, and additional security can help. A centre with long leases to established practitioners and a strong local catchment is a very different proposition from one with short leases and vacancies, and the loan terms will reflect that difference.
Secure the rooms, protect the practice
A practice’s premises and patients are its most valuable assets. Tell us about the opportunity, the timeline, the property you can offer and the exit, and a specialist will tell you how private finance can help. There is no credit check when you first enquire, your details remain with our team, and contract dates and figures help us respond quickly. Discuss your practice.
Frequently asked questions
Why would a practice use a private loan when banks like healthcare?
Banks often do support healthcare, but their processes can be slow. Private loans help when a purchase must settle quickly, accounts are behind, or the deal is unusual.
Can a practice buy its premises with a private loan?
Yes. A private first mortgage can settle the purchase, with a bank refinance once the bank's process is complete.
Can a loan fund a practice acquisition?
Yes. The purchase price, any fit-out changes and working capital for the transition can be funded using property security, with a bank refinance planned later.
What security do practice owners usually use?
Medical suites or buildings owned by the practice or a related trust, principals' homes and investment properties.
Prefer to start now? Enquire here
About 60 seconds. No credit check when you first enquire, and a secured lending specialist calls you back.