| Metric | Details |
|---|---|
| Entity / Legal Name | Pacific Dental Services LLC (d/b/a PDS Health) |
| S&P Rating | B |
| Moody‑s Rating | B2 |
| Rating Outlook | Stable |
| Investment Grade Status | Non‑Investment Grade — Highly Speculative |
| Sector | Healthcare / Dental Support Organization (DSO) |
| Headquarters | Irvine, California |
| Supported Office Count | 900+ offices across 25+ states |
| Annual Revenue | ~$2.5 billion+ (estimated 2025) |
| Cap Rate Range | 7.00% – 8.50% |
| Typical Lease Term | 10 – 15 years (NNN) |
| Guarantee Type | Corporate (Pacific Dental Services LLC) |
| Typical Building Size | 3,000 – 7,000 SF |
| Typical Price Range | $1,200,000 – $5,000,000 |
Pacific Dental Services Business Overview & NNN Investment Profile
Pacific Dental Services, now branded as PDS Health, is the largest dentist-founded dental support organization (DSO) in the United States, supporting over 900 dental offices across more than 25 states. Founded in 1994 by CEO Stephen Thorne IV in Irvine, California, PDS operates under a “supported autonomy” model where the company provides business management, technology, marketing, and operational support while affiliated dentists maintain full clinical autonomy. Revenue surpassed the $2 billion milestone in 2022 and has continued growing at approximately 12% annually, driven by same-office growth and new office openings.
For NNN investors, PDS dental offices are attractive small-format properties in suburban retail locations with purpose-built dental operatory infrastructure. The DSO model means leases are typically guaranteed by the Pacific Dental Services corporate entity, not individual dentists, providing a centralized credit that covers the entire portfolio. However, the S&P B and Moody‑s B2 ratings reflect the company’s leveraged capital structure, including significant term loan debt and dividend recapitalizations. In March 2025, S&P affirmed the B rating after PDS issued an incremental $250 million first-lien term loan, with adjusted leverage expected to remain above 5.0x through 2026.
Pacific Dental Services carries non-investment grade ratings reflecting its private-equity-influenced capital structure with leverage above 5.0x. Despite the elevated leverage, S&P noted PDS’s “continued trend of solid operating performance” including 12.8% revenue growth in 2024 driven by 9% same-office growth and 4% growth in average spend per visit. The company’s ability to hire and retain dental talent while growing its scale has been a consistent credit positive. PDS raised $3.29 billion in total funding and received a strategic investment from Perceptive in January 2025. NNN investors should weigh the strong operational trajectory against the leveraged balance sheet when evaluating PDS-guaranteed dental NNN properties.
Cap Rate Analysis & Pricing for Pacific Dental Services NNN Properties
Pacific Dental Services NNN properties trade in the 7.00% to 8.50% cap rate range as of Q1 2026. Newer build-to-suit offices in primary suburban markets with 12+ year remaining terms trade at the tighter end, while older locations with shorter terms price wider. Dental offices are among the most re-tenantable healthcare property types due to their suburban retail locations and modest footprints, which provides some downside protection for investors even at speculative-grade credit levels. Pricing ranges from $1.2 million to $5 million.
| Comparable Healthcare NNN Tenant | S&P / Moody‑s | Cap Rate Range |
|---|---|---|
| Aspen Dental | NR / B3 | 6.50% – 8.00% |
| Heartland Dental | NR / Caa1 | 7.00% – 8.50% |
| Acadia Healthcare | B+ / B1 | 7.00% – 8.50% |
No. Pacific Dental Services carries S&P B and Moody‑s B2 ratings, placing it in the non-investment grade highly speculative category. Despite strong operational growth and over 900 supported offices, the leveraged capital structure (5.0x+ debt/EBITDA) keeps the company well below investment grade thresholds.
PDS dental office NNN properties trade in the 7.00% to 8.50% cap rate range as of Q1 2026.
The Only Pacific Dental Services NNN Advisor Whose Fee Comes From the Deal, Not From You
In NNN buyer representation, the listing broker typically pays a cooperating commission to the buyer’s broker. On the majority of transactions, this means there is no separate fee to you as the buyer. Where a cooperating commission is not available, our compensation is agreed upon with you in advance so there are never surprises.
Find It — Pacific Dental Services offices sourced with PDS corporate guarantee confirmation, DSO market positioning analysis, and location quality assessment before you commit.
Fund It — S&P B / Moody‑s B2 DSO credit requires lenders who understand dental healthcare NNN. We have 150+ lender relationships to find competitive terms.
Exit It — Selling a Pacific Dental Services property? Dental NNN in prime suburban locations attracts steady buyer demand. We help maximize your exit price.
Get Your Free Pacific Dental Services NNN Consultation →
In a 1031 exchange? Tell us your timeline — we move faster.
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Own a Pacific Dental Services Property? Capital Markets Strategies Beyond Selling
Maturing debt and considering refinancing? Our capital markets team maintains 150+ lender relationships underwriting NNN properties across investment-grade and non-investment-grade credit tiers. We structure rate-and-term refinancing, cash-out refis, and bridge-to-perm takeouts.
Evaluating a 1031 exchange or disposition? We represent both sides of Pacific Dental Services NNN transactions — whether you are looking to exit at peak value, exchange into a higher-quality credit tenant, or reposition within the same sector.
Need a current valuation? We maintain live comps on Pacific Dental Services NNN transactions and can produce a Broker Opinion of Value within 48 hours reflecting today’s cap rate market.
Own multiple Pacific Dental Services properties? Considering an off-market sale?
Investment Grade represents owners on confidential disposition of Pacific Dental Services portfolios and individual properties through off-market direct-to-principal distribution to specialty REITs, private equity funds, and family offices. Pacific Dental Services buyer demand runs deep, and portfolio sales consistently produce stronger pricing than sequential individual sales because the institutional buyer pool is structured around portfolio acquisition.
For multi-property owners considering a portfolio disposition, see Selling Investment Grade NNN Off-Market: Tenant-by-Tenant Buyer Demand. For the full off-market framework covering individual property dispositions, sale-leasebacks, and 1031 coordination, see Off-Market CRE Sales: The Complete 2026 Guide.
The pre-listing conversation is at no cost and fully confidential. Email team@investmentgrade.com or see contact Investment Grade.
