A medical office sublease lets one practice rent all or part of its leased space to another practice for the remaining term of its own lease. It can help a practice that has more space than it needs cover some of its rent, and it can help a practice that needs space quickly or for a shorter term. This guide covers both sides of the deal: how to decide whether a sublease fits, what to check in your lease, how to price the space, and which mistakes cost medical practices the most.
Sublease space is a small part of the Los Angeles medical market. CBRE’s Q2 2026 survey of Greater Los Angeles medical outpatient buildings found about 2.24 million square feet of vacant space, and only about 120,000 square feet of it was sublease space. Overall vacancy was 10.1%. In general office, sublease space rose sharply after 2020 (Cushman & Wakefield reported a 190% increase from pre-pandemic levels by Q1 2023), but vacant sublease inventory has since been falling. For a medical practice, that means the sublease option exists but is thinner than the office market headline suggests, so you may need a broker who knows medical space to find it.
Why Should You Sublease Your Medical Office Space?
You’re a doctor or in the medical field, you have a practice, and you’ve got the patients coming in. But there are times when being in a medical office space is not ideal for your patient population or your business.
When this happens, it might be time to sublease your medical office space. Here are some reasons why:
It’s Less Expensive To Share Medical Office Space
If you’re looking to move your medical practice, you may be wondering if it is better to lease or sublease your office space. While both options have their benefits, there are several reasons why subleasing may be the right choice for your business.
If you have extra space. A sublease can offset rent on space you are not using. Keep in mind that you usually remain responsible to your landlord for the full lease, including rent, insurance, and repairs, even when your subtenant is responsible to you. Read your lease and your sublease together before you sign anything.
If you need space. A sublease can be faster than a new lease and can come with built-out exam rooms, plumbing, and cabinetry that would be expensive to install. The tradeoff is a shorter term, a layout you did not design, and rules set by a master lease you did not negotiate.
Benefits Of Medical Networking
The benefits of medical networking are endless. The first and most obvious benefit is the opportunity to expand your services and reach more patients. Medical networking allows you to use other people’s space, equipment, and staff to meet the needs of your patients. This means that you can offer more services, which in turn leads to more revenue for you as well as an increase in the number of patients who will be coming through your doors.
Subleasing Your Space Can Save You Time
Let’s face it: owning a medical practice can be a lot of work.
It’s just not always possible to keep up with all the responsibilities that come with owning your own space. But what if you could save yourself some time while still keeping your practice?
That’s where subleasing comes in. You can find a tenant who will take over all the responsibilities of owning and operating a medical office, including paying their share of the rent and utilities, while you work on growing your business elsewhere.
That way, you don’t have to worry about being tied down by one location or another—you can focus on growing your practice without worrying about finding new clients or keeping up with maintenance issues!
Grow Your Medical Practice
Medical office space is often in high demand, yet can be difficult to find. One way to alleviate this issue is to sublease your medical office space. By subleasing, you essentially become a landlord and have the ability to collect rent while still using the space yourself. This can be a great way to grow your medical practice, as the extra income can be used to invest in new equipment or hire additional staff.
Additionally, subleasing allows you to choose your tenant, which means you can choose another medical practice that is compatible with your own. This can create a symbiotic relationship between the two practices, and lead to increased referrals and patients. Ultimately, subleasing your medical office space can be a great way to grow your business while still maintaining a high level of control.
Other Benefits Of a Shared Office Space
In today’s economy, more and more businesses are looking for ways to save money. One way to do this is to sublease your medical office space. By subleasing, you can share the cost of the lease with another business. This can be a great way to save money, especially if you are just starting.
In addition, by subleasing your medical office space, you can also take advantage of the other benefits of shared office space. These benefits can include having access to a larger variety of medical equipment and services, as well as being able to network with other businesses in the same building. So why not give it a try? You may be surprised at how much you enjoy the benefits of shared office space.
Medical Office Sublease Agreement (And How to Sublease Office Space)
Medical subleases usually need more detail than office subleases. Make sure your agreement addresses biomedical waste handling, storage of chemicals and supplies, patient record confidentiality and who has access to shared areas, signage, hours of use, shared equipment, janitorial service, insurance, and what happens to the space if the master lease ends early. Because you are not dealing with the property owner directly, ask for a copy of the master lease and compare its use, insurance, and assignment terms against your sublease.
Tips for Successful Medical Office Sublease in Los Angeles
Here are some tips for a successful medical office sublease in Los Angeles:
Check With the Landlord
Before you sublease space to another practice or take space from one, read the master lease for its sublease clause. Many leases require the landlord’s written consent, and some limit who may occupy the space and for what use. Ask for the landlord’s consent in writing before any money changes hands. Screen the other practice by checking references and visiting its current office.
In addition, it is important to review the lease agreement to see if there are any stipulations about subleasing. Once you have determined that subleasing is allowed, it is important to find a reputable and trustworthy tenant. Be sure to screen potential tenants carefully and check references before making a final decision. With a little bit of planning and research, you can successfully sublease your office space in Los Angeles.
Take Inventory
As the medical industry continues to grow in Los Angeles, so does the demand for office space. If you’re a medical professional considering subleasing your office, there are a few things you need to do to ensure a successful transaction. First, take inventory of your furniture, equipment, and supplies. You’ll need to determine what is essential to your practice and what can be left behind.
It’s also important to take pictures or videos of your office space so that potential subtenants can get an idea of the layout and size. Once you have a good understanding of what you have and what you need, you can begin the search for the perfect subtenant.
When screening candidates, be sure to ask for references and tour their current office space. With a little bit of planning and due diligence, you can find the perfect subtenant for your Los Angeles medical office.
List Your Space in the Right Place
When it comes to listing your medical office space for sublease in Los Angeles, you want to make sure you list it in the right place. There are a few different ways to do this, but the most important thing is to reach as many potential subletters as possible. Reach the right audience by listing the space with a broker who handles medical space and on the major commercial listing platforms, such as LoopNet and Crexi. Include the square footage, number of exam rooms, existing equipment and cabinetry, the remaining lease term, the monthly rate, and whether the lease is full-service gross or triple net.
Another way to reach potential subletters is to list your space on general real estate websites. While this may not be as targeted as a specific site for medical office subleases, it will still allow you to reach a large number of people who may be interested in your space. Regardless of where you choose to list your space, the most important thing is to make sure it is listed in a place where it will be seen by as many potential subletters as possible.
Know What the Market Will Bear
Compare your asking rate to current market data. CBRE reported an average asking rent of $4.11 per square foot per month, full-service gross, for Greater Los Angeles medical outpatient buildings in Q2 2026, with a wide spread by submarket (see the table below). Sublease rates are often set below the master lease rate when the term is short, so ask a broker for comparable subleases, not just direct leases.
| Submarket | Average asking rent per sf per month | Overall vacancy |
|---|---|---|
| Greater Los Angeles | $4.11 | 10.1% |
| Santa Monica | $6.02 | 6.7% |
| Beverly Hills | $5.90 | 12.1% |
| West Los Angeles (submarket total) | $5.63 | 13.3% |
| Tarzana | $5.02 | 11.8% |
| Burbank | $4.19 | 6.4% |
| Downtown Los Angeles | $4.13 | 3.2% |
| Pasadena | $4.10 | 10.0% |
| Glendale | $3.75 | 5.3% |
| San Fernando Valley (submarket total) | $3.28 | 9.6% |
Consider Time Sharing
When it comes to medical office sublease in Los Angeles, there are a few things you need to keep in mind to ensure success. First and foremost, you need to consider time sharing. This means that you will be splitting the space with another business, and it is important to make sure that you are both on the same page in terms of hours and days of operation.
You also need to be clear about what each of you is responsible for in terms of utilities, janitorial services, and so on. In addition, you should sign a legal agreement that outlines the terms of your arrangement. By taking these steps, you can help ensure a smooth and successful medical office sublease in Los Angeles.
Physicians’ Biggest Legal Mistakes in Sublease Negotiations
Subleasing your medical office space is a great way to save money and find a new home for your practice. But if you’re not careful, you could be making costly mistakes. Here are some of the most common legal mistakes physicians make when subleasing their medical office space.
Three mistakes cost practices the most:
- No written sublease. Verbal arrangements are hard to prove and easy to dispute. Put the rent, term, use, shared areas, insurance, and repair duties in a signed sublease.
- No written landlord consent. If your master lease requires consent, ask for it in writing before the sublease takes effect. Without it, you may be in default of your own lease.
- Not reading the master lease. The sublease normally cannot give the subtenant more rights than the master lease allows, and its use, insurance, and default terms may flow down to the subtenant. Know the expiration date, because the sublease cannot outlast it.
Have a real estate attorney review both documents before signing.
This is why it’s so important to have a lawyer review your sublease agreement before you sign anything. An experienced real estate attorney can help you avoid these and other common mistakes, ensuring that your medical office space sublease goes smoothly—and saving you money in the long run.
Optimizing Space for Enhanced Care: The Impact of Addressing Office Congestion
“Look around at the busiest areas in your office, and determine what is causing the pileups.”
When we take a moment to observe the bustling areas of our office, especially those spots where traffic seems to bottleneck, we uncover a wealth of insights into how our space is utilized—and, more importantly, how it might be falling short of meeting our needs. This exercise isn’t just about identifying problem areas; it’s a crucial step toward creating a more efficient, productive, and welcoming environment for everyone who steps through our doors.
In the context of medical commercial real estate, understanding these congestion points is vital. It impacts not just the comfort of our patients and staff but also the flow of operations and the overall patient experience. For instance, a waiting area that becomes too crowded can increase stress and decrease satisfaction for patients. Similarly, a narrow hallway that frequently becomes congested can hinder the swift movement of medical personnel, potentially delaying care.
By pinpointing where these pileups occur, we can start to re-imagine our space. Maybe it means reconfiguring waiting rooms to offer more seating or creating clearer pathways for foot traffic. Perhaps it’s about optimizing the layout to ensure that frequently accessed areas are more accessible, reducing the time staff spend navigating the office. It could even lead to more significant changes, like expanding the physical footprint of our space to alleviate overcrowding.
Addressing these issues is about more than just aesthetics or convenience; it’s about patient care, staff morale, and operational efficiency. A well-designed medical office space can significantly enhance the quality of service we provide, improve the work environment for our team, and ultimately, contribute to better health outcomes for our patients.
This proactive approach to managing our physical environment demonstrates our commitment to excellence in healthcare and our dedication to creating spaces that reflect the high quality of care we aim to deliver.
The Office Real Estate Sector’s Post-Pandemic Reality
General office in Los Angeles had a direct vacancy rate of 16.4% in Q3 2026, or 17.7% including sublease space (Kidder Mathews). Medical outpatient buildings had a 10.1% overall vacancy rate in Q2 2026 (CBRE). The surveys cover different building sets, so compare trends, not exact numbers.
For example, in Washington, D.C., a 13-story building with ground-floor retail sold for $18.2 million in 2023, down 70% from its 2017 price tag of $61.8 million. At the same time, only 21% of properties sold in the suburbs recorded a decline in value.
The lack of transactional volume makes comp identification more difficult, but lower-end buildings not in prime locations are suffering and we expect that trend to only accelerate, notes Peter Kolaczynski, Director at CommercialEdge.
The office market outlook for 2024 suggests an increase in these discounted sales, driven by high rates and reduced demand. The market is adjusting to these challenges, with a noticeable shift in the bid-ask gap and an increase in loan defaults, hinting at continued upheaval in the sector.
How To Find Medical Office Space To Sublease/Lease In Los Angeles?
Start with four decisions: how much space you need, which submarket fits your patients and referral sources, your monthly budget, and how long you want to commit. Then check three channels: a broker who handles medical space, commercial listing platforms, and referrals from other practices and hospitals in the area. When you find a space, tour it with your architect or contractor to confirm that the plumbing, ventilation, and layout meet your clinical needs and applicable codes. Budget time for any alterations before you move in. Lead time varies, so begin the search well before your current lease ends.
Office Real Estate Market Insights as of August 2024
The table below summarizes key statistics on office space listing rates, changes in those rates over the past 12 months, total vacancy rates, and notable changes in those rates, alongside top listings with their respective price per square foot across various markets. This data provides insights into the current state of the office real estate sector, revealing trends and market adjustments in response to various economic factors.
| Market | Listing Rate (Aug-24) | Change (12-Month) | Total Vacancy | Vacancy Change (12-Month) | Top Listing | Price/Sq Ft |
|---|---|---|---|---|---|---|
| National | $32.78 | 2.7% | 19.4% | 200 bps | – | – |
| Boston | $53.25 | 15.4% | 15.9% | 540 bps | 137 Newbury Street | $96.17 |
| Orlando | $28.01 | 15.2% | 16.8% | 20 bps | 801 North Orange Avenue | $34.00 |
| Dallas | $31.04 | 13.4% | 22.9% | 430 bps | McKinney & Olive | $86.31 |
| Miami | $51.25 | 11.1% | 14.1% | 80 bps | 701 Brickell | $140.00 |
| Atlanta | $33.80 | 9.0% | 21.3% | 260 bps | 1180 Peachtree | $63.00 |
| Austin | $45.84 | 7.0% | 27.8% | 660 bps | Indeed Tower | $84.21 |
| Philadelphia | $32.78 | 6.6% | 17.7% | 350 bps | Two Liberty Place | $53.50 |
| Tampa | $29.93 | 6.4% | 14.7% | 30 bps | Bayshore Place | $52.00 |
| Washington DC | $41.60 | 3.0% | 17.0% | 170 bps | 500 8th Street NW | $79.58 |
| Charlotte | $33.43 | 2.6% | 18.6% | 310 bps | Morehead Place | $46.00 |
| San Francisco | $66.93 | 2.3% | 27.6% | 440 bps | Sand Hill Commons | $204.00 |
| Los Angeles | $42.94 | 2.2% | 16.7% | 100 bps | 100 Wilshire | $108.00 |
| Detroit | $21.92 | 1.8% | 24.0% | -80 bps | Orchestra Place | $36.14 |
| Bay Area | $54.43 | 1.4% | 24.8% | 550 bps | 245 Lytton Avenue | $147.48 |
| Denver | $31.10 | 1.2% | 24.1% | 340 bps | 200 Clayton Street | $73.00 |
| San Diego | $40.13 | -8.5% | 19.1% | 310 bps | La Jolla Commons–Tower I | $72.60 |
| Portland | $27.11 | -3.4% | 20.1% | 420 bps | Fox Tower | $43.38 |
Sublease Medical Office Space FAQs
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Conclusion
Subleasing a medical office can save time and money, but it adds a second set of documents, deadlines, and responsibilities. Read the master lease, get the landlord’s consent in writing, and compare asking rents in your submarket before you commit. Tolj Commercial offers free consultations to help medical practices evaluate space and lease options. Give me a call or schedule a free consultation online today, and let me help you take your business to the next level.
