📖 Approx. 3 minutes ／ Updated 2026.07.07
The real estate issues in M&A differ significantly between hospitals (20+ beds) and clinics without beds. This article explains the differences between the two, considering building size, facilities, and legal restrictions under the Medical Care Act, as well as the one-stop support system of the CentralMedience Group.
1. Why Real Estate Becomes an Issue in Medical Institution M&A
In business succession and M&A for medical institutions, the handling of land and buildings where clinics and hospitals are located significantly impacts the transfer price and scheme design. The practicalities vary greatly depending on the combination of whether the transfer target is the “medical corporation itself” or “business only,” whether the land and buildings are “owned by the medical corporation” or “owned by the director personally,” and whether they are “company-owned” or “leased.”
According to the Ministry of Health, Labour and Welfare’s Survey of Medical Institutions and fixed asset tax assessment data, real estate value often accounts for 30-70% of the total transfer consideration for medical institutions. In other words, errors in real estate valuation or handling can lead to a difference of tens of millions of yen in the transfer price.
2. Key Issues in Medical M&A Involving Real Estate
- Clarification of Ownership Structure: Medical corporation ownership / Director’s personal ownership / Leased property / Ownership by a related corporation, etc.
- Fair Valuation of Real Estate: Combination of land value index, income capitalization approach, comparable sales approach, and cost approach.
- Handling of Mortgages and Collateral: Scheduling for loan repayment, cancellation of registration, and new collateral arrangements.
- Lease Agreement Transfer: Agreement with the landlord, conclusion of new contracts, and restoration clauses.
- Real Estate Taxation: Capital gains tax, registration and license tax, real estate acquisition tax, and fixed asset tax settlement.
- Confirmation of Usage, Building Coverage Ratio, and Floor Area Ratio: Possibility of continued use as a medical facility.
- Evaluation of Building Aging: Seismic resistance, reserve for repairs, history of major renovations.
3. Comparison of Real Estate Handling: Hospitals vs. Clinics
| Item | Hospital (20+ beds) | Clinic without beds |
|---|---|---|
| Building Size | Thousands to tens of thousands of m² | 100-500 m² |
| Ownership Structure | Mostly owned by the medical corporation | Often personally owned by the director or leased |
| Seismic Requirements | Hospital seismic standards required | General building standards |
| Medical Corporation Special Provisions | Increasingly specialized for medical use | Easier to change business format |
4. Why is a Real Estate Integrated Support System Important?
In medical institution M&A, issues related to the Medical Care Act, tax law, and real estate law are intricately intertwined. Mistakes in real estate transactions can reduce the transfer price by tens of millions of yen, resulting in an irrecoverable loss for the seller.
Collaboration with an appropriate real estate company is essential, but outsourcing can easily lead to information sharing losses and ambiguity in responsibility, increasing stress for the seller. The CentralMedience Group includes M&A specialists for medical M&A, a specialized real estate sales company, and a network of tax accountants and judicial scriveners, enabling smooth succession on a one-stop basis.
Frequently Asked Questions
Q. Real estate is owned by both the medical corporation and the director personally. Is it possible to consolidate ownership?
A. Yes, it is possible. From reorganizing ownership structures before M&A (personal to corporate or corporate to personal) to simultaneous processing at the time of transfer, tax accountants and real estate experts within the CentralMedience Group will design the optimal scheme.
Q. Can a leased clinic be transferred?
A. Yes, it can. Our group’s specialized real estate team will provide full support, including obtaining consent from the landlord and concluding a new lease agreement with the new tenant.
Q. Can you provide a fair real estate valuation for medical institutions in rural areas?
A. Yes. We have extensive experience in valuing properties in rural areas and can provide realistic valuations by combining the income capitalization approach and the cost approach, even in regions with few comparable sales.
Q. Can you also introduce financing for the acquiring party?
A. Yes, we can support the financing needs of the acquiring party by leveraging our group’s network of financial institutions.
Q. Can I request only an appraisal of the land and buildings?
A. Yes, we can accommodate requests for standalone appraisals not necessarily tied to an M&A. Please feel free to contact us.
Related Columns
- Complete Guide to Business Succession for Hospitals and Medical Corporations: Practicalities of Medical M&A from Successor Shortages to Success Stories
- Step-by-Step Guide to Medical M&A and Hospital Succession: Explaining the 6 Steps from Consultation to Closing with Case Examples
- Complete Guide to Tax Schemes for Medical Corporation M&A: Key Issues for Tax Accountants and CPAs
- Complete Guide to Selling or Transferring a Clinic: Medical M&A Experts Explain Price Trends, Procedures, and Precautions
CENTRAL MEDIENCE GROUP
Peace of mind even with real estate involved.
Completed through group collaboration.
Medical M&A Advisory × Specialized Real Estate Sales Company × Network of Tax Accountants and Judicial Scriveners.
One-stop succession support achievable with the CentralMedience Group.