COVID-19 could boost Geelong Private Medical Centre sale
Geelong’s front line in battling the COVID-19 pandemic could provide a boost to the owners of a major city medical centre who have listed it for sale.
The four-storey Geelong Private Medical Centre at 73-79 Little Ryrie St has been listed with CBRE Healthcare and Social Infrastructure agents Sandro Peluso, Jimmy Tat, Josh Twelftree and Marcello Caspani-Muto.
The centre represents Victoria’s most significant sub-$50 million health sector asset to be publicly marketed since 2018, Peluso says.
Price hopes for the property are above $30 million, he says.
The agency puts potential annual net rental income at $2.25 million.
The four-storey building contains 4937sq m of lettable area with an airbridge connecting to the former Geelong Private hospital building, which was recently converted by Barwon Health to become part of Victoria’s front line in treating patients with COVID-19.
“Healthcare investments are sought after for their low levels of risk during exposure to market downturns and recessions,” Peluso says.
“In the midst of COVID-19, the healthcare sector has arguably been one of the stronger performing sectors, showing returns of between 4 and 6% and the trend is likely to continue in 2020.”
Tat says existing covenants with many of Australia’s largest medical and healthcare operators, coupled with a lack of blue chip assets on the market, should encourage a range of local, national and offshore buyers to vie for the site.
“The youth of the building, which will allow for more depreciation benefits and lower expected capital expenditure cost when compared to older properties, is expected to appeal strongly to investors — particularly given the short supply of quality investment opportunities across several asset classes,” he says.
“Geelong Private Medical Centre presents investors with a strategic opportunity in one of Victoria’s leading healthcare hubs that will fuel consistent tenant interest in the building.”
The property was last sold by receivers in 2017 for almost $18 million.
Singapore-based International Healthway Corporation bought the property for $28 million three years prior.
The property is near the heart of Geelong’s hospital precinct, neighbouring Barwon Health’s Building B, which for generations was the Baxter House maternity hospital, and the city’s main University Hospital, the largest in regional Victoria.
Barwon Health established an acute respiratory assessment clinic, with beds and consulting rooms, in Building B earlier this year.
Healthscope closed Geelong Private Hospital in 2018, returning the property to Barwon Health.
The Building B site has also been touted as a potential site for a Geelong’s Women’s and Children’s Hospital promised by the State Government.
This article from The Geelong Advertiser originally appeared as “Geelong Private Medical Centre listed with $30m-plus price tag”.