[DAYS_LEFT] days left of your Medeconomics free trial

Subscribe now

Your free trial has expired

Subscribe now to access Medeconomics

Practice takeover

I am working as a locum at a practice. The solo GP's spouse is the practice manager and they both plan to retire soon. If I can take over the practice, they will let me buy the premises (purpose-built in the 1980s).They want £700,000 for the building plus £200,000 for the fixtures and fittings. The notional rent is currently £23,450 a year (grossly below what a surgery worth £700,000 should attract) and is due for review in 2010. I think the premises are only worth £300,000, while the couple claims they were valued at £800,000 in 2007. However, they have no documentation to support this. They simply say they reduced the price because of the credit crunch. I suggested the GP takes me into partnership and leases the surgery to me but this was unacceptable because it may attract the taxman's attention. How I can convince them to sell at a reasonable price?

Even with a reasonable increase next year, the current notional rent does not suggest a realistic relationship to a valuation of £700,000.

There are reasons why the market value could vary greatly, one being if the site is not fully developed and there is room for expansion; another is that the alternate use value exceeds its value as a surgery.

The most likely scenario is suitability for residential redevelopment. In some high-value residential areas, it is possible that a 'dated' surgery has a value less than the residential development land on which it sits.

If the owners are being unrealistic, the only real way to try to persuade them would be to have a full report on the surgery value and alternate value by a surveyor, including how the figures may have altered over the past couple of years.

Do you have a financial question? Ask our experts

Have you registered with us yet?

Register now to enjoy more articles
and free email bulletins.

Sign up now
Already registered?
Sign in

Database of GP Fees

Latest Jobs