Why a Dentist Is Sinking His Teeth Into a Real Estate Empire

Private dental practices are entrepreneurial endeavors. But they are prolific, irrefutably brick-and-mortar, and mostly recession-proof — which often makes them a solid real estate investment. Even better if the investor and entrepreneur are one and the same. Such is the case for Peter Boulden, of Atlanta Dental Spa, who carefully extracted himself from a complicated malocclusion of lease clauses this year to become an empowered owner-operator of his eighth commercial real estate property.

Earlier this year, Boulden zeroed in on a centralized office to run and scale his entrepreneurial enterprises and dental practices scattered throughout the northern Atlanta suburbs. Represented by Patrick Hallwood of KW Realty North Atlanta, Boulden went under contract on the 5,500-square-foot, second-floor suite of 2556 Apple Valley Road in the Brookhaven neighborhood in February.

But the deal only closed recently after 10 months of waiting, and a whole lot of real estate-ing, in between.

"Owning real estate is the biggest leverage you can have as a small- to medium-sized business."

Peter Boulden, Atlanta Dental Spa

First, Boulden almost unintentionally ended up as the landlord instead of an owner-operator.

The prior owner hadn’t been able to come to satisfactory terms with the tenant, a branch of Edward Jones, and when the property was sold, the latter decided to invoke a vague renewal option in its lease, Hallwood told LoopNet. “Up to the last day of the lease, we weren’t sure if they were going to stay or not.”

But Boulden didn’t want to close until the tenant was out, partially because he’d since coincidentally found himself on the opposite end of a similar struggle at his flagship Atlanta Dental Spa in Buckhead.

He’d been renting the location since 2009, when the owner suddenly sold the spot from underneath him, giving him just nine months to relocate. “There was a redevelopment clause that could be called on between years 11 and 15 of his 15-year-lease,” Hallwood explained. The owner was perfectly within their legal right to trigger the clause, Boulden explained, but it still caught him off-guard. “It was quick.”

"People say McDonald’s is really more of a real estate play than it is a hamburger play. I kind of adopted the McDonald’s model in dentistry."

Peter Boulden, Atlanta Dental Spa

Amid the waiting game for the second-floor tenancy in Brookhaven, the triggering of the redevelopment clause in Buckhead, and a stack of paperwork in between, Hallwood started eyeing the first floor of the Apple Valley Road office, which had also come up for sale. If only Boulden could buy both the upstairs and downstairs of the 18,000-square-foot Brookhaven building, in separate sales, he thought.

“I had sold all the other units in the building, and kind of got passed over for the listing on this one,” Hallwood said. “But since I had sold [Boulden] the unit upstairs and knew he had to relocate, I ended up working with him on the downstairs condo as his buyer’s broker.”

Together they started connecting the dots.

“The first thing I look for is location,” Boulden said. “The second is market competition — how many other dentists are in the area. The third is visibility, and the fourth is ease of access.” Contracting a proprietary, industry-specific market analysis firm Dentagraphics to get a comprehensive picture of both competition and demographics like household income, Boulden found that the Brookhaven office location scored high on all counts.

It became important that Boulden moved into the downstairs space quickly to make the transition from his practice in Buckhead, which he planned to bifurcate into two smaller locations amid his running sum of eight properties.

But if Edward Jones held out on its lease upstairs, they could delay construction on Boulden’s practice space, Hallwood noted.

Thanks to Hallwood, listing agent Lorene Schaefer of eXp Commercial, and Boulden’s own real estate experience, it all worked out. Boulden recently closed on both deals and has already begun constructing his first-floor space, acquiring the latter for just under the listing price, at a cool $1.1 million.

"Pulling on my 30-years of experience as a business attorney, I reviewed the Edward Jones lease and realized the option to renew clause [drafted by the tenant using a standard form] was not enforceable in Georgia because the tenant and landlord had not agreed on the renewal rental rate," Schaefer told LoopNet. The listing team escalated the issue and the tenant agreed to move out, so the buyers were able to close three weeks later, allowing Boulden to start planning construction.

"If you like it and you’re going to be there long-term, pull the damn trigger."

Peter Boulden, Atlanta Dental Spa

Working with a space designer and architect, Boulden is having the space built out to accommodate his exact specifications. “It has to feel good, welcoming and comfortable, and I found it’s much easier to gut a building and redo it than try to work within an existing layout,” he said. “It’s more expensive, but I’m of the mindset that if it’s yours, there’s no better place to put the money than to design a place the way I want it for my team and my patients.”

And the construction can now commence freely, Hallwood noted. After the bumpy road of losing tenancy in one building while simultaneously juggling a contract for a fraught leasehold ownership in another, Boulden became the majority owner of the mix of condos in the building. “Technically, he could dissolve the [condo association] and solely make decisions, because it’s based on 50% agreement or more, which he has,” Hallwood pointed out.

The deal has left the dentist feeling even more empowered, Boulden expressed. “Owning real estate is the biggest leverage you can have as a small- to medium-sized business. Dentists are highly concerned about inflation, and real estate typically is a hedge against inflation. I don’t think we’re going back to that ‘free money’ kind of thing, as interest rates likely won’t be considered low again anytime soon,” he continued. “People say McDonald’s is really more of a real estate play than it is a hamburger play. So this is why I kind of adopted the McDonald’s model [of buying real estate] in dentistry.”

Partially through entrepreneurial endeavors such as his podcast, Bulletproof Dental, Boulden often advises other dentists. When it comes to real estate, he told LoopNet, his advice is, “If you like it and you’re going to be there long-term, pull the damn trigger.”