Insight · Property
Planning approvals and healthcare zoning: what buyers underwrite
A permit is part of the price — why the statutory position of a medical asset belongs in the valuation, not the fine print.
In medical property, statutory position decides who can occupy a building, what they can practise and what the space is worth.
Medical use is not commercial use
A consulting suite and an office are legally distinct. Licensing, radiation use, waste, accessibility and essential safety measures follow from clinical use. Some tenancies depend on permissions a general medical permit may not carry. We underwrite from the planning scheme.
What we verify before capital moves
Our statutory checklist sits at the front of underwriting, not the back:
- Current permissions — what use, scale and configuration is actually permitted today, including any conditions that limit clinical operation.
- Licence pathway — what a specific operator type (day surgery, imaging, pathology) would need by way of approvals, and how long that pathway realistically runs.
- Overlays and constraints — heritage, flooding, design and access controls that shape what can be built or altered.
- Compounding constraints — parking triggers, traffic, waste management and the operational conditions that make a permitted use expensive in practice.
The optimism discount
Assets priced on a proposed use change carry the market's optimism in their price. We underwrite the permissions that exist and treat planning upside as optionality. We decline assets whose numbers only work if the planning authority agrees with the vendor.
Approvals as part of the delivered asset
On the development side, we carry the statutory pathway as a workstream: consultants engaged early, approvals shaping the base building, licence evidence held as a deliverable. When we hand over a facility, the paperwork that lets it operate is part of what we hand over.
What this means for you
If you are buying or developing
Verify what the scheme permits, map the licence pathway, and treat un-permitted upside as optionality, never as the case that pays for the asset.
If you operate or plan to expand
Confirm in writing what clinical uses the permits cover. Landlords who understand this will show you the documentation.
General commentary only — not legal, financial or investment advice. Read our Terms & Disclaimer. Next in this series: uptime economics.