Guide to Selling a Sports Medicine & Performance Therapy Practice in Hawaii

Selling your Sports Medicine and Performance Therapy practice in Hawaii presents a unique set of opportunities and challenges. The market is active, but a successful exit requires more than just finding a buyer. It demands careful preparation, a deep understanding of your practice’s true value, and a strategy for navigating the process. This guide provides insight into the key factors you need to consider to achieve a premium valuation and secure your legacy.

Hawaii’s Favorable Market for Sports Medicine Practices

The timing for selling a sports medicine practice in Hawaii is strong, supported by positive local and national trends. Buyers are actively seeking quality practices, driven by a growing demand for physical and performance therapy services. This favorable climate is not an accident; it’s the result of several key economic and demographic shifts.

Strong Local Demand

Hawaiis healthcare sector is on a significant growth trajectory, with employment projected to increase by 15.3% through 2030. This growth is amplified by the states focus on athletics, including initiatives to place trainers in all public high schools. This creates a robust, built-in patient base for sports medicine and performance therapy, a factor that sophisticated buyers value highly.

National Growth and Specialization

Nationally, the physical therapy market is booming, expected to become a $61.7 billion industry by 2030. The sports physical therapy sub-specialty is projected to see some of the highest growth rates, making your practice particularly attractive to regional and national buyers looking to expand their footprint in a desirable location.

Beyond market trends, buyers will scrutinize the operational and regulatory standing of your practice. In Hawaii, this means a deep dive into your compliance with the Hawaii Physical Therapy Practice Act (HRS 461J). Prospective buyers and their legal teams will verify everything from therapist licensing to the proper supervision of support staff. A small compliance gap can become a major headache during negotiations. For instance, many owners from the mainland are surprised to learn that dry needling is not within the scope of practice for PTs in Hawaii. Understanding these local nuances is not just about ticking a box. It is about protecting your practice’s value and ensuring a smooth transaction. Uncovering these issues early is far better than having a buyer find them for you.

Who is Buying Practices in Hawaii Today?

While specific sale prices in Hawaii are rarely made public, the market is active with different types of buyers. Understanding their motivations is key to positioning your practice. You are not just selling a clinic. You are selling a strategic asset.

1. Strategic Buyers: These are often larger regional or national therapy groups looking to expand into the Hawaiian market. They are looking for established practices with strong referral networks and a solid patient base. For them, your practice is a turnkey solution for market entry.

2. Private Equity-Backed Groups: These buyers view your practice as a “platform” for future growth. They are interested in strong profitability, efficient operations, and a management team that can help them expand further in the islands. They often pay premium multiples but also have a more rigorous due to diligence process.

Knowing which type of buyer is the best fit for your personal and financial goals is the first step toward creating a competitive sale process that maximizes your outcome.

Selling your practice is a multi-stage journey that moves from internal preparation to a successful close. It begins long before the “For Sale” sign goes up. The first phase involves organizing your financials and operations to present them in the best possible light. Next, your practice is confidentially marketed to a curated list of qualified buyers to create competitive tension. Once offers are received, the negotiation phase begins, focusing not just on price but also on terms that protect your interests. The most intense phase is often due diligence, where the buyer verifies every aspect of your practice. This is where most deals face challenges, but thorough preparation can ensure a smooth path to the final closing. A well-managed process protects your confidentiality and your time, letting you focus on running your practice.

What is Your Sports Medicine Practice Really Worth?

Determining your practice’s value is more than a simple formula. It’s a blend of art and science. While national averages suggest net profit margins of 14-20%, sophisticated buyers look deeper, focusing on a key metric: Adjusted EBITDA. This figure normalizes your earnings by adding back owner-specific expenses to show the practice’s true cash flow potential for a new owner. That Adjusted EBITDA figure is then multiplied by a number (the multiple) that reflects your practice’s quality and risk. We find that moving from “fine” to “elite” in these areas can dramatically increase your multiple.

The day you close the deal is not the end of the journey. It is the beginning of your transition. Your role post-sale is a critical point of negotiation. Will you stay on for a year to ensure a smooth handover, or are you looking for a clean break? Protecting your staff and ensuring their continued success under new ownership is often a key goal for founders looking to preserve their legacy. Finally, the structure of your sale has massive implications for your after-tax proceeds. Thinking through these elements in advance, from your transition agreement to your tax strategy, ensures the rewards of your hard work are fully realized. Proper planning here can be just as important as the sale price itself.