Footscray childcare centre the most expensive of 2020
Childcare is big business and investors continue open their wallets for the asset class, with a Melbourne centre snapped up for $11.5 million.
The Footscray Nino Early Learning Adventures Centre, is Australia’s first childcare centre sold to top $10 million this year.
The newly developed, multi-level facility at 282-288 Geelong Rd has a building area of 2228sqm and basement car parking for 25 vehicles in a prime corner block position.
It is the second major childcare sale in 2020 following an Oakleigh facility selling for $8.08 million two weeks ago, proof there is high demand for this type of asset, according to CBRE’s Josh Twelftree..
“These results are the catalyst for buyers flocking to the sector as during these uncertain times childcare, the essential service investment, continues to sell and new buyers are attracted to the activity in the sector,” Twelftree says.
“Investors have made clear their intentions to focus on properties with sound fundamentals and we are already experiencing a ‘flight to quality’ where well-located assets with reliable income streams and long leases are keenly sought.
“Childcare investments with strong underlying land value are on the top of the investors’ wish list as it gives them confidence that due to the higher cost of entry into these areas, it is less likely a competitor will open a centre in close vicinity.”
The sale was negotiated on behalf the Agosta family as they continue to divest their childcare portfolio.
It is the eleventh Nino Early Learning Adventures centre sold by CBRE over the past three years, amassing a total transactional value of more than $150 million.
CBRE’s Jimmy Tat says investors are clearly searching for stability.
“When the commercial market was at its weakest earlier this year, investors shifted their focus to stable investment opportunities – such as childcare centres – that provide essential services,” Tat says.
“The Federal Government’s support of childcare services further reinforced this.
“Investors typically rate tenancy profile as the top priority after location, primarily to ensure the investment provides a strong income guarantee.”