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How Does Cost Segregation Help?

Cost Segregation is a tax planning tool that helps owners of commercial real estate save significantly on their federal income taxes. Let the Equity Healthcare Real Estate Team put you in front a Cost Segregation Specialist today! Cost Segregation


Tips For Renewing your Lease

When renewing your lease there are a few pointers to remember to insure your lease negotiation goes smoothly.

• Do you have a renewal option in your current lease? If so, make sure you are aware of the notice period the Landlord requires you to give them if you are going to renew.

• If you are going to renew, do your renewal terms reflect current market conditions? Sometimes, pre-negotiated renewal terms are negotiated when you execute the initial lease. If this was over 3 years ago, you might be able to negotiate better terms.

• If you plan on relocating to a new location, make sure you allow enough time to evaluate the market, select another property to move to and negotiate your new lease. If you do not allow for enough time to do this and your current lease expires before you move, you will be in Hold Over and depending on what the penalty is for Hold Over in your current Lease, you might be at risk of paying 2x the amount of rent each month you are in Hold Over. Also, you run the risk of the Landlord re-leasing the space and giving you notice to vacate.

If you review your lease and start to get overwhelmed call us and we can help you review your lease and determine the best course of action. We know the Tampa Bay Commercial Real Estate market and we and we spcialize in professional and medical office space.

Carleton Compton 813-789-7729 ccompton@equity.net

Neil Khant 813-490-9817 nkhant@equity.net

Lease Negotiation Case Study

Lease negoitation can be a beneficial exercise to help you save on your overhead costs. Below are two examples of how our team helped two different companies save thousands of dollars.

  • Recently we were referred to a dentist that asked us to help re-negotiate his lease. After we reviewed his lease we found several areas that could be addressed. The end result was we were able to save him over $20,000 in rent over the next five years of his term. In addition, we were able to help him better understand the break-down of his monthly invoice and provided a lease abstract to his lease that highlighted the important terms and conditions that he needs to be aware of in the future. So he doesn’t have this problem happen again.
  • Another recent case involves a client we helped  re-negotiate their lease in Tampa. Immediately after reviewing the lease we noticed that their Operating Expenses were based off of 1999.  We had the Landlord amend the Lease to reflect the current year’s expenses and were able negotiated a few dollars off their PSF price in rent. The client’s over head charges dropped significantly.

A few minutes of lease review from a qualified Commercial Real Estate Broker can help you save thousands without doing anything. If you would like to see if you’re overpaying. Contact us today.

Jason Scott  jscott@equity.net or Carleton Compton ccompton@equity.net

Insurance Demystified. Make sure you’re covered.

With the peak of hurricane season on top of us. Take a moment to evaluate your insurance policy.

In the event a hurricane causes interior and exterior damage to the building I lease for my medical practice, who is responsible for the restoration of the building and contents?

Unfortunately, there is not a definitive answer to this question. Generally a landlord is required to carry property insurance on the building or space you are renting by their mortgage company. Property insurance is broken down into two segments, Real Property and Personal Property. Real property is a legal term encompassing real estate and ownership interests in real estate (immovable property).  Personal Property is commonly described as movable property or movables – any property that can be moved from one location to another.

 Real property insurance will cover the landlord’s structure, interior and exterior, from any damages incurred. However, most landlord policies don’t cover personal property.  

Lease agreements typically only address damages to the physical structure. Landlords will add loss of use riders to their policies to ensure that they receive their rent income. The landlord will still need to make their mortgage obligations even if the structure has been damaged and is unusable. Those policies only cover the landlord and the structure. They do not provide the tenant with any compensation for any damages they may have incurred.

The tenant is responsible for insuring their contents and interests.

If your space is damaged, most leases address the damage through provisions concerning rent abatement for that portion of the space.

Business interruption insurance is property insurance that compensates for lost or reduced business income due to hazardous (i.e. hurricane or tornado) damage. It can also compensate for the extra expenses of setting up a new or temporary office and operating expenses such as utilities, salaries, rents, taxes and benefits for key employees.

Business interruption insurance cannot be purchased separately but is purchased in addition to the hazard insurance rider on the policy. When purchasing this type of insurance, it is important to consider how long it will take to rebuild your practice, including the time you may need to obtain permits, equipment and hire new employees.

These days, insurance companies typically offer small businesses the following packages:

  • Business owner’s or package policies. These offer the basics listed above for as little as $300 a year. But they tend to leave out workers compensation, automobiles used by the business, some thefts, and professional liability. Most important, this policy won’t cover you if the cause of your damage of business loss is a flood.


  • In-home business policies. Most home-business owners think they’re covered by their regular homeowner’s policy. They are, but only up to $2,500, so insurance companies are adding policies specifically designed for them. Essentially, this is a business owner’s policy attached as a rider to a homeowner’s policy, which can cost between $250 and $750 annually. But it’s available in only 28 states, and again, it doesn’t cover flood damage.


  • Wind storm coverage. This is necessary in most coastal areas, but is included only in most inland policies. It covers wind and hail damage, and it does cover water damage from rain — but not damage from flooding waterways. Cost: $400 to $500 a year based on the type of commercial building.


  • Flood insurance. By now, you’ve probably figured out that most business policies exclude any kind of coverage for flood damage. Entrepreneurs have to purchase this from the National Flood Insurance Program, administered by the Federal Emergency Management Assn. For about $300 a year, it will cover up to $500,000 in damage to commercial structures caused by rising water or tidal surges. It does not cover for flooding caused by rain. Among the caveats: There’s a 30-day waiting period after you’ve paid your premium before the insurance becomes effective, so don’t wait until the next hurricane warnings are on the evening news. And it may not cover the contents of the building; you’ll have to buy a separate policy. If the property is worth more than $500,000, entrepreneurs can buy additional flood insurance from private insurance companies, but this tends to be very expensive.

To make sure you adequately covered you should sit down with a tax or insurance professional and determine your needs.

Some business owners learn the hard way that they didn’t buy enough coverage. Remembering to consider certain pieces of your business property when purchasing an insurance policy is vital to keeping your doors open.

Your business may not possess all the following types of property, but you can use this quick reference list to make sure you have thought of all property categories and any insurance coverage that may be warranted for your business:

  • Buildings and other structures (owned or leased).
  • Furniture, equipment and supplies
  • Money and securities
  • Accounts receivable records
  • Improvements and betterments you made to the premise
  • Boilers and machinery
  • Data processing equipment and media (including computers)
  • Valuable papers, books and documents
  • Mobile property such as automobiles, trucks and construction equipment
  • Satellite dishes
  • Signs, fences and other outdoor property not attached to a building
  • Intangible property (good will, trademark, etc.)
  • Leased equipment


  • Review your current insurance coverage. Is it enough to get your business back in operation after a disaster? Will it cover the replacement cost of vital facilities? Make it a regular annual procedure to review and update insurance. Also remember that insurance on mortgaged property probably only covers the lender with nothing left over for you.
  • Be aware of your “contents” insurance. Does it cover the replacement cost of critical equipment?
  • Know what your insurance does not cover. Most general casualty policies do not cover flood damage. Many require additional riders for windstorm, sewer backup, or earth movement. Consider adding coverage for likely perils, especially flood insurance.
  • Consider business interruption insurance that assists you with operating needs during a period of shutdown. It may help you meet payrolls, pay vendors, and purchase inventory until you are in full operation again. Also be prepared for the extraordinary costs of a disaster such as leasing temporary equipment, restoring lost data, and hiring temporary workers.
  • Don’t assume that, just because you haven’t experienced flooding before, it will never happen. Flooding patterns can change dramatically with development: water, which runs off new streets and parking lots, may overwhelm nearby streams and surrounding land. Landslides and sinkholes may develop because of distant earth movement, natural or man-made. The creek by your building may be a tiny, placid stream that has never flooded, but a downpour may change it into a destructive torrent that destroys your building foundation. Plan for the worst.

Cost Segregation

It’s never too early to think about your taxes and ways to save money. One items mostly overlooked is the depreciation of the construction of your building.

A simple cost segregation analysis can help you determine if you are getting the most savings possible. Cost segregation is the process of identifying, segregating, and reclassifying components of commercial property into shorter depreciable tax lives. The core benefit of a cost segregation study is the additional cash flow that is created by reducing an owner’s current taxable income. For all practical intents, a cost segregation study can be viewed as a long-term no-interest loan from the federal government. What’s more, the cost of the study is a deductible business expense.

 Who can benefit from a cost segregation study?

A good cost/benefit analysis begins with answering these key preliminary questions:

Does the property qualify for these tax benefits?

 What is the owner’s tax status?

How long does the owner plan on owning the building?

Want to know more? Contact us today

 Carleton Compton ccompton@equity.net or Jason Scott jscott@equity.net

What is a Lease Audit?

A lease audit is an in-depth review of a tenant’s occupancy costs to ensure that the costs are in compliance with the lease requirements.

What are some Red Flags that might indicate discrepancies and overpayments?


·Changes in the management company
·Accounting changes in billings from the Landlord
·Move-in activity
·Tenant Fit-up
·Marketing and promotional events around the     building
·Increases in annual costs greater than 2% – 4%
·Building Construction
 If any of these circumstances have happened to you contact us today. You could be paying more than your fair share.
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