This article is from the Australian Property Journal archive
OVER $50 million worth of childcare centres have changed hands with yields as low as 4.63%, highlighting the strength of capital within the sector as Asian investors shift focus to alternative real estate investments.
The facility at 173 Majors Bay Road Concord sold for $13,200,000 after only seven days on market. The 100-place centre is set across a 1,625 sqm site and carries a lease to local private operator, Endeavour Early Education, through to 2034 + options.
Agents Stonebridge Property Group managed the sale on behalf of the Healthco HealthCare & Wellness REIT.
Tom Moreland said the sale signifies the pent-up demand for well-located Sydney based assets and the resilience of the childcare market which is being witnessed on a national basis.
“Investors continue to acknowledge the buoyancy of the childcare sector, bolstered by unwavering government support and appreciation for built-form assets given the ongoing difficulties being experienced in the construction sector, limiting the supply of new centres,” he added.
The agents also negotiated the sale of a Guardian childcare centre at Essendon in Melbourne’s north west on behalf of the REIT.
The 131-place childcare centre was snapped up by a Chinese investor for $9 million on a yield of 5.49%. The 1,909 sqm site has a lease in place to the national provider until 2031 + options.
Kevin Tong said it was the offshore Chinese investor’s first foray into the childcare sector.
“This demonstrates the ongoing shift from Asian capital towards premium Australian childcare assets, particularly those occupying large metropolitan landholdings across the eastern seaboard,” said Tong.
In Queensland, an established facility at 17 Clay Street, West Ipswich, 33km from Brisbane CBD and leased to G8 Education has recorded the lowest yield for over two years in the sunshine state, trading for $3,000,000 at 4.63%. The property sold off-market to a Sydney based private investor.
Up north, a brand new facility at Caboolture, 48km from the Brisbane CBD, sold to a private buyer for $7,700,000 at a yield of 5.6%, following a competitive EOI campaign. The property is set across a large 2,921 sqm site and leased for 15 years to national operator, Eden Academy, headed by a former G8 Education COO.
Stonebridge’s team including Tom Moreland, Michael Collins, Kevin Tong, Rorey James, Thomas Proberts, James Freemantle and Brett O’Neill, also handled these sales:
- Little Locals Childcare Greenbank, Qld – sold $8,900,000 – 5.5% yield on a development fund-through basis;
- Little Miracles Terrigal, NSW – sold $3,400,000 – 4.87% yield;
- Affinity Childcare Maryborough, QLD – sold $3,500,000 – 6.87%;
- Eden Academy Woodridge, QLD – sold $5,050,000 – 5.80%;
- G8 Childcare Lyndhurst, VIC – sold $5,700,000 – 4.68% yield;
- Imagine Childcare Maryborough – sold $5,850,000 – 5.68% yield.
