Guide to Selling a Pediatric Physical Therapy Practice in Detroit, MI

Unlocking a Successful Exit in a Growing Market

Selling your pediatric physical therapy practice is a major decision. For owners in the Detroit area, the timing might be better than you think. The market for therapy services is growing, and buyer interest is strong. This guide will walk you through the key factors to consider, from understanding your practice’s true value to navigating the sale process and preparing for what comes next.

Your Market Opportunity in Detroit

The decision to sell doesn’t happen in a vacuum. It is heavily influenced by market conditions. Fortunately, the outlook for pediatric physical therapy is very strong.

National Strength

Nationally, the physical and occupational therapy market is projected to grow at over 10% annually for the next several years. This growth creates a favorable environment for sellers. It attracts a wider pool of buyers, from private equity groups to larger strategic healthcare systems, who are looking to enter or expand in stable, growing specialties. This is not a trend to ignore.

The Detroit Advantage

In Detroit, this national trend is amplified by a growing awareness of the need for specialized pediatric care. Your practice sits at the intersection of a resilient healthcare sector and a community that values specialized services for children. Buyers see this as a sign of stable demand and future growth potential, making a well-run Detroit practice an attractive asset.

Beyond the numbers, a buyer is purchasing the engine that drives your practice. For a pediatric physical therapy clinic, this means your referral relationships with local pediatricians, schools, and hospital networks are a core asset. Similarly, the specialized training of your staff and your reputation in the community are not just points of pride. They are tangible value drivers. A buyer will also closely examine your operational systems. How efficient is your scheduling and billing? Is your EHR system modern and effective? Having these elements organized and optimized before you consider a sale is one of the most effective ways to command a premium valuation. It demonstrates that the practice is a well-run business, not just a collection of providers.

What are we seeing in the market for therapy practices today? It’s not just about listing your practice and waiting. The market is active and strategic. Here are three key trends we are watching.

1. A Shift from Potential to Proof. Buyers today are less interested in what a practice could do and more interested in what it is doing. They pay for proven operational efficiency and stable revenue streams. This is why we tell owners that the best time to start preparing for a sale is two to three years before you plan to exit.

2. Increased Interest from Diverse Buyers. Its no longer just other local therapists looking to expand. Private equity-backed groups and larger healthcare platforms are actively acquiring therapy practices to build regional density. They bring significant resources but also have a very specific “checklist” for what makes a practice a good investment.

3. The Importance of a Competitive Process. One-off offers rarely result in the best outcome. The highest valuations are achieved when multiple qualified buyers are brought to the table. This creates a competitive dynamic that gives you, the seller, leverage to negotiate favorable terms.

The process of selling your practice can feel overwhelming, but it follows a structured path. It begins with preparation, where we help you organize your financials and identify areas to optimize. Next comes a formal valuation to establish a clear, defensible market price. With a valuation in hand, we confidentially market the practice to a curated list of qualified buyers. Once interest is confirmed, the process moves to due diligence. This is the most intensive phase, where the buyer verifies everything about your practice, from financial records to regulatory compliance. Many deals encounter problems here if the initial preparation was not thorough. With expert support, this stage runs smoothly, leading to the final negotiations and closing.

How much is your practice worth? While many therapy practices trade for a multiple of their annual revenue, often between 0.5x and 2.5x, sophisticated buyers dig deeper. They focus on Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), which is a truer measure of cash flow. They adjust your reported profit to account for owner-specific expenses. The final multiple they apply depends on several risk and growth factors. A practice that is well-prepared and professionally represented will always command a higher multiple.

Your valuation multiple is not fixed. It changes based on key attributes of your business.

The transaction does not end the day the papers are signed. A successful exit includes a thoughtful plan for what comes next. For you, this means defining your role, if any, after the sale. Will you stay on for a transition period? For how long and in what capacity? For your team, it means ensuring their future is secure, as staff retention is critical for the new owner’s success. For your patients and their families, it means a seamless transition of care that honors the trust they placed in you. These considerations are not afterthoughts. They are key deal points that should be negotiated to protect your legacy and ensure the continued success of the practice you built.