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Sessional Room Rental Rate

Discussion in 'Practice Management' started by jphizz, Jan 28, 2014.

  1. jphizz

    jphizz Member


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    Hi,

    First time post! So go easy please ;)

    I'm looking at opening up a clinic with a room at a local Medical Clinic with 5 GPs and multiple allied health professionals. I've been given a possible 'sessional room rental rate' of $150 per session. This is based on a 4 hour block & will be for an initial 6month period.
    After this it will be just under $300 for a 7hour shift (Saturday 9-4pm). :confused:
    I'm not sure on what other medical centers charge but am thinking this is abit steep because my plan is obviously to grow the business - and if I take on another day, then its nearly $600 for 2days.
    If anyone, that is currently renting a room in a medical center, & able to shed some light into this, that would be most helpful.

    Cheers
    JK
    ps: the clinic is in Melbourne
     
  2. Cardiff pod rookie

    Cardiff pod rookie Welcome New Poster

    Hi JK,
    I've just agreed to rent a room at a local medical clinic in Wales, UK. So the prices won't compare to Melbourne - in the UK I'm guessing your costs are more comparable to London.
    This medical practice is flexible though and I've agreed an all inclusive price of £10 per hour with times and days flexible to suit my needs. I've heard London prices being more like £18-£20 per hour.

    Some of this advice may be obvious so apologies in advance but how many patients would you see in a session and what would you be charging them? Does it work out financially if you were fully booked, half booked or just a couple of people? How many patients use the medical facility? Can you advertise on the screens in the waiting room, can you leave your leaflets around, will the GP's be referring on to you or can they at least suggest you as a qualified Podiatrist.

    Are the other allied health profs. private too? Are you able to speak to any of them?

    Every private Podiatrist I have asked has told me the first month is extremely quiet but things build up especially with word of mouth, advertise, have a website etc. I'm expecting to pay some rent at the start with not many patients but I hope to use that time to meet the GP's and build my 'brand' with them a bit.

    If they want you to sign something and you're concerned about being tied to the cost it might be an idea to include an early exit clause in the contract i.e. minimum patients, minimum revenue etc.

    Not sure if this has helped but good luck.
    cheers
    M
     
  3. JAYNES

    JAYNES Active Member

    Hi JK
    Seems a bit expensive a you are just starting up you may only just make the rent in the first few months as you are building up your patients.
    i hope you hear from other pods that rent on day basis.

    Good luck
    Jaynes
     
  4. fishpod

    fishpod Well-Known Member

    if you did 10 sessions a week thats 1500 dollars aweek thats 6 grand a month the rental costs are absurd they will take nearly all your earnings coz it equates to around 68000 a year based on working 45 weeks a year. my advice walk away. i personally do 11 sessions a week in a gp surgery and dont pay anything near your charges. hope it all works out . a fair rent would be around 10 percent of your sessional income.
     
  5. jphizz

    jphizz Member

    Thanks for your replies ...
    Heres the rundown:
    $150 per saturday for first 6months, then $150+gst per 4hour block session ($165). Saturday 9-4pm
    Annual increase of 5% of base rent
    3Yr Term.
    No advertising or Admin reception support (extra cost involved). Shared Room with another health professional.
    Need to provide own computer as 'other' health professional doesn't want me touching the "Clinic" computer as I may get access to his files. (I thought a password would do the trick, but he wouldn't budge)
    No HICAPS or reception assistance. I need to install own phone line ($299) & have HICAPS ($25p/m).

    I've already asked for reduction of rent just to get started, but to no avail - doesn't seem like alot of negotiation space either.
    Upon further research around the melbourne area, most are around 90-150 per day including reception assistance & HICAPS use, parking, computer use etc ...

    Got my final meeting this next week, so we'll see what happens.

    Thank you for all the input/feedback so far.

    Cheers
    JK
     
  6. David Smith

    David Smith Well-Known Member

    JK

    What would your hourly fee rate be?
    If I was hiring out a room in my clinic I would probably ask £100/day (Aus$200) all in, including reception services and clinic database use.
    In my business I usually reckon on a gross profit of 60% and a net profit of 40% and that is me taking all the risk of running a High St business

    So if you cleared $400 dollars in 4 hours then if you take home $200 with minimal risk you'll be doing ok. But I expect you gross more than a $100/hour so I would say that $300 a day might be at the top end of reasonable if you were turning over $800/day.

    I think all the added extra's might be taking the total a bit over the top tho.

    Having said that, we turnover equivalent of $800/day and I would be quite happy to pocket $500. (NB We means Me as the clinician, a clinic manager and a trainee assistant)

    Its your call at the end of the day
     
  7. fishpod

    fishpod Well-Known Member

    That's a big assumption Dave as young start out Aussie pods don't earn 400 quid aday that's 2000 quId a week or 90000 quid a year what planet are you from I'm sure lots of Aussie pods earn 180000 dollars a year but they have been established for years and you know most of their English counterparts could only dream of an income so high . This is based on all the practices for sale and their absolute crap turnovers.the profession is a pyramid some at the top do very well but most do less than average.
    I suspect the mean salary for pods in aus and uk is fairly low.
     
  8. björn

    björn Active Member

    Jphizz, that is very expensive even if in a blue chip inner east suburb - especially without any support. YOu have to wonder if they already play so hardball when you are new, how difficult will they be as a landlord.
     
  9. David Smith

    David Smith Well-Known Member

    Averaging £400 / day turnover not profit = £160 in my pocket - So if I only had to pay £150 rent on the same turnover then I could pocket £250 - happy days.

    I was asking JK what his fees would be but judging by the salary offered to Aus pods as seen on t'internet I.e.$90k is common but average is more like $60k - the session rate is around $50-$70 / 30min. So it appears that $800/day turnover is a reasonable assumption
     
  10. carolethecatlover

    carolethecatlover Active Member

    Here in Sydney, the room rate is $70 per half day in The Posh Eastern suburbs.
    It may have gone up in the last couple of years since I enquired.
    That was with use of receptionist, it was a mixed beauticians/cosmetic doctors clinic, very nice.
    Another room by the 4 hours in Glebe charges similar. This with a bunch of psychologists and other non-doctors. Check out Nature's energy in Glebe for their prices too.
    In the UK, it worked the other way, I got 70% of the fees I brought into the clinic, computer, reception and cleaning etc included. This was from the usual rate of Pounds 40 to 60 per hour, so less than Pounds 20 per hour, (as foot health practitioner). That was very good as there was an physiotherapist, osteopath and others of like ilk, and we worked together really well. You are being had !!
     
  11. toughspiders

    toughspiders Active Member

    Hi There i was offered a GP room at $200 a day with reception facilities i got them down to $150 but didn't take in the end

     
  12. jphizz

    jphizz Member

    Thanks to all the responses above.

    He has agreed to keep it at 150+gst for the time being. Still no HICAPS.
    Its actually a funny system in place.
    Every Allied Health Professional has their own HICAPS terminals at reception. About 6 terminals, plus mine will be 7, lol.
    When they complete a transaction, they/we have to come to reception to complete it.
    Otherwise an extra cost is involved if the reception staff do it.
    Some have been doing it for years.

    I've been guaranteed all the GP/EPC referrals requiring podiatric intervention.
    Other than that, I'm like everyone else - its all on me.
    Building up networks in my local area with physios, osteos & chiros, PT functional trainers etc.

    I'm pretty stoked with all this mind crunching from everyones responses.
    Thank you once again.

    Cheers
    JK
     
  13. björn

    björn Active Member

    That seems so silly on the Hicaps.

    You need a seperate phone line for each one - unless they share a line, in which case you'd be better off with a single machine with individual practitioners and separate bank accounts registered.
     
  14. jphizz

    jphizz Member

    I know right? Sounds bizarre to me why no one else in the clinic has mentioned that. Yes, you need seperate phone lines for each one. Actually, I might see if I can tail onto someone else's terminal and cover half their costs.
    It definitely looks a mess on the front desk counter with all the HICAPS/EFTPOS terminals. We'll see how it pans out.

    JK
     
  15. Airlie

    Airlie Active Member

    hi there

    I have been sole trading in GP rooms in SA for 7 years and firstly, rent is $110/day. I have admin support for appointments but not billing - which i prefer because all the items i need to know for orthotics etc. makes it easier to do myself. at most clinics I use their prac managament systems. the hicaps is in my own name and I keep it in my room. Time has to be well managed when you dont have admin support so I am about to purchase some prac managment software that will integrate with medicare to process EPC and DVA claims online, all you need to do is enter the details once and then update them as referrals are renewed - I anticipate this to take atleast 2 minutes of each patient which with a 6-7 hour day you can fit an extra appointment in so should pay for itself pretty quickly. Also consider a wireless hicaps or suncorp bank do wireless claims for health funds then you just need an internet connection which should also save $$. Plus in your own room you save time walking to and from reception.

    Hope this helps

    Airlie
     
  16. Kara47

    Kara47 Active Member

    Sounds way too expensive & complicated too me, but I'm not up on city prices. Have a look about & see how many empty shops are in the vicinity & find out what the rents are. Have a look at a few commercial leases & see if you have to pay council rates on top of your electricity, phone & water, or if they are included. This will give you a better idea of if you are getting a good deal or not.
    The GPs in the clinic aren't obliged to refer their px to you, px can request to see the person of their choice.
    If you are paying top dollar you should be getting reception & cleaning at the least.
    I have an Osteopath friend who found a location that was vacant for 18 months, made the Real Estate agent an offer & has secured it for less per week than 2 days daily rate he is currently paying.
    Try advertising in your local paper for a room, ask about, speak to Real Estate agents.
    I wouldn't sign a lease that long, it's a tenant's market at present, so shop around.
    Happy Hunting!!
    Cheers,
    Kara
     
  17. Pompy

    Pompy Member

    HICAPS are NOT currently doing a wireless HICAPS which accept private health claims. Perhaps in the near future though.
     
  18. jb

    jb Active Member


    Not to hijack this thread (asking rate is far too high OP), but HICAPS are currently trialling mobile terminals for some "lucky" practices.

    We run one out of multiple locations, and it successfully transmits both Medicare EasyClaim and Private Health claims via GRPS. We have multiple practitioners registered to the terminal, and it has been as simple as an hard-wired terminal to use. It docks when not in use, for charging etc.

    There is a catch: from what I gather neither BUPA nor Medibank Private or HCF have signed on for mobile claim transmission, meaning that the terminal must be docked and connected to a phone line to process claims through these funds. Given their large share of the Private Insurance market, this is more a frustration for our clients than anything, and has left more than a handful wondering why their fund is not as advanced as some others. I recall successfully claiming from at least 8 different funds aside.

    I am to believe that the roll-out will continue in the coming months, starting with NAB customers (likely as HICAPS is its subsidiary).

    Happy to field other queries by PM if necessary.

    Jair
     
  19. Hoppo

    Hoppo Member

    Hi JK

    I am paying $100 a session at a similar sounding clinic in Brisbane, hope this helps
    Hoppo


     
  20. jphizz

    jphizz Member

    Hi team,
    I'm back again ... and its 2years on now.
    Since I was only opened 2 half sessions per week - word gradually got out and I ended up working at this same medical clinic 6days per week.
    The rental is now $3200 per month!!! Its time to move out.
    As someone from an earlier post said, if he's difficult to work with now ... he will be even more difficult later on.
    I'm at a point now where I have a good client base so can branch out! (Although the location is definitely ideal for the exposure)
    I'm now on the move to another location after building this for the last 2years.
    Thanks for the tips.
    Regards,
    Justin K
     
  21. drfoot2

    drfoot2 Active Member

    HI all, I find it interesting reading the thread and the replies to the original rental proposed. This is either a clear sub lease or license agreement being offered. To ask if there is a lunch break deduction is ridiculous as this implies you want employee terms also. Commercial leasing states ALL outgoings are to be paid by the tenant (unless there is an agreement of sorts in place)
    Under all retail leases and license agreements, the tenant agrees to an agreed rate, either by session, day, week/monthly rate. Annual increases are generally an agreed amount 3-5% or CPI, whichever is the greatest. To work out 1/2 day, full day and factor this over a week and then a month is a silly way to calculate as the rate generally offered for a 1/2 day will be much higher than a longer term tenancy.
    I have Physio in my rooms, where they occupy 2 treatment rooms, have equal 1/2 share of the reception, waiting area and common areas. They have a 2x2x2 year license agreement, with 4% annual increases. There rental is $30K annually plus GST. They also pay $3K outgoings per year. This is in the suburbs of Melbourne. If I was to sub let to several allied health practitioners, eg psychology, dietetics etc on a 1/2 day sessional rate, I would be charging 120-150, room ONLY. Day rate would be less, $200. These are the going rates in Melbourne.
     
  22. Footpath

    Footpath Member

    Hi All,

    In the practise I work for my employer pays $50-110 a day for rent, simple bookings via phone, answering phones. We do our own rebooking once a pt has been seen and take payments. The lower figure is for a 'half session four hours and top end 8 hours.
    Hope this helps.
     
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