Buying Land for a Medical Office Building in DFW: Due Diligence Before You Close
By Structures and Interiors.
The contract usually gives you a due diligence period, a set number of days to study the property and walk away if it does not work. That window is the cheapest time to find a problem. After closing, every surprise in the ground or at city hall becomes yours to pay for. Here is what to check on a lot in Dallas–Fort Worth before you close.
Line up your team before the clock starts. A real estate attorney reads the contract and title work. A civil engineer looks at the site, the utilities, and the drainage. A general contractor can price what the engineer finds and tell you whether the lot fits the building you have in mind. If you are still choosing a site, we can help you compare lots, and a first budget is at no charge.
Zoning and platting
Zoning says what you may build on the land. Confirm that the zoning district allows a medical, dental, or veterinary use, and read the conditions that come with it: setbacks (how far the building must sit from each property line), height, parking ratios, and masonry or landscape rules. Some districts allow a clinic only with a specific use permit (SUP), which goes to public hearings. If the land needs rezoning, make closing depend on it, because a rezoning is a vote, not a form.
A plat is the recorded map that creates a legal lot. In Texas, cities approve plats under Chapter 212 of the Local Government Code, and most cities will not issue a building permit on land that is not platted. Ask whether the parcel is already a platted lot, part of a larger tract that must be divided, or a lot whose plat must be redone (a replat) to fit your building.
Utilities and capacity
A water line in the street is not the same as water service to your building. For each utility (water, sanitary sewer, storm drainage, electric, and natural gas), find out where the nearest line is, whether it is large enough, and who pays to bring it to your lot. Sewer is the one that hurts most often, because it flows by gravity and the nearest line may be too shallow or too far away. Fire protection matters too: the fire department may need a hydrant within reach of the building, and a larger building may need a fire sprinkler line with enough water pressure behind it.
At GI Alliance Willow Park, an endoscopy center and clinic we built from the ground up, the site work included an offsite sewer extension and an extensive storm drain system. Work like that should be known and priced before you close.
Floodplain, drainage, and the soil
Look the lot up on the FEMA flood maps (the Flood Map Service Center at msc.fema.gov) and ask the city whether it keeps its own floodplain or drainage maps. Land in a mapped floodplain can still be built on in many cases, but it may need fill, an engineered study, a higher floor, and a longer approval. Even outside a floodplain, the city will usually require you to hold back stormwater on site with a detention pond or underground storage, and that takes land you may have counted as parking.
Order a geotechnical report. A geotechnical engineer drills borings, tests the soil, and recommends the foundation. North Texas clay swells when wet and shrinks when dry, and the report tells the structural engineer how to design for it. Also study the grade. At Urban Trails Animal Hospital in North Richland Hills, the building sat on the low end of the lot, where rainwater flowed toward the foundation, and the foundation had to be poured during an exceptionally rainy season. A low building pad, a sloped lot, or a need for retaining walls all show up in the site cost.
Access, driveways, and easements
Patients have to get in and out easily. Ask where the city or the Texas Department of Transportation (TxDOT, for state highways and frontage roads) will allow a driveway, and whether you will need a turn lane, a median opening, or a shared drive with a neighbor. On many pad sites, access runs through a shared drive governed by a recorded agreement. Read it.
Easements are rights other people hold on your land: a utility line, a drainage channel, a shared drive, a pipeline. You generally cannot build on top of them. The title commitment lists the recorded ones, and the survey shows where they fall.
The ALTA survey and the Phase I
An ALTA survey is a boundary survey drawn to the national ALTA/NSPS Minimum Standard Detail Requirements. It shows the property lines, easements, improvements, access, and flood zone, along with optional items you and your lender choose from the standard's Table A. Lenders and title companies often require it.
A Phase I Environmental Site Assessment looks for signs of past contamination through records, interviews, and a site visit. It does not sample soil. A Phase I done to ASTM E1527-21, the standard the EPA recognizes under its All Appropriate Inquiries rule (40 CFR Part 312), can help protect a buyer from liability for contamination it did not cause. Certain parts of it must be no more than 180 days old when you close, so time it inside your due diligence period. If it finds a concern, a Phase II with soil or water samples is the next step.
Impact fees and what the city will ask for
Many DFW cities charge impact fees for new development to help pay for roads, water, and wastewater. Texas allows them under Chapter 395 of the Local Government Code, and each city sets its own schedule. Ask the city for the fees that apply to a medical office on your lot. Also ask what public improvements the city will want with your project: a sidewalk, a street widening, a water line extension, or a share of a traffic signal. In Fort Worth, for example, a private developer who pays for public infrastructure signs a Community Facilities Agreement with the city.
Many cities offer a pre-development meeting where planning, engineering, and fire staff answer questions about a specific site. It is one of the best uses of your due diligence time. Our guide to site approvals in DFW cities covers what follows once you own the land.
Buying the right lot is the first step in a new building. If a lease or an existing building turns out to fit better, Structures and Interiors also finishes out and renovates existing space.
Common questions
When should a contractor look at the land?
During the due diligence period, before you close. A contractor and civil engineer can spot utility, drainage, and access costs that do not show up in the land price. We will look at a lot with you, and a first budget is at no charge.
Do I need both an ALTA survey and a Phase I?
Usually, yes. The ALTA survey shows boundaries, easements, and access, and the Phase I looks for past contamination. Lenders often require both, and they answer different questions.
Can I build a medical office on land in a floodplain?
Sometimes, but it adds study, fill, or a raised floor, and time at the city. Check the FEMA flood maps and the city's own drainage maps before you close, and have a civil engineer tell you what it would take.
Who tells me whether utilities are available?
The city and the utility providers, with a civil engineer reading the answers. Ask where each line is, whether it has enough capacity, and who pays to extend it to your lot.
Planning a new building, a finish-out, or a renovation? Tell us about it.