One of Victoria’s premium childcare centre property investment offerings for 2024 has hit the market, in the form of a state-of-the art facility in sought-after Boroondara.
Fitzroys’ Chris James and Ben Liu are marketing 358 Warrigal Road via Expressions of Interest closing Friday, 15 November at 2pm, on behalf of a private investor.
Expectations are of $11 million-plus.
The substantial corner site of 1,683sqm boasts 80 metres of prime street frontage, and comprises a high-profile, modern childcare facility of 932sqm, and basement car parking for 29 vehicles.
Niño Early Learning Adventures, which has 12 locations across Melbourne, has a 20+10-year lease that returns $699,042 per annum plus outgoings and GST.
“This is one of Melbourne’s best childcare centre offerings for 2024 - a state-of-the-art facility with a secure lease to a quality operator in an excellent location in sought-after Boroondara,” James said.
“The property has an excellent tenancy covenant, with a long-term lease to highly-regarded operator Niño Early Learning Adventures.
“We’re expecting investors, high-net-worth individuals and syndicates in particular to show interest, including existing participants in the childcare centre investment sector who are accustomed to good returns from secure leases to quality tenants.”
“The childcare centre sector is considered a safe investment in the current environment of volatility in both the residential and share markets. Federal government subsidies have really supported growth in the sector, making childcare more accessible and supporting places and attendances.”
James noted the property is licensed for 138 places, in line with the most current optimal operating models of more than 100 places, which means better cost efficiencies for the tenant.
“Completed in 2018, this ultra-modern facility also offers great depreciation benefits,” he added.
Liu said the property is in a fantastic location in the City of Boroondara.
“The property is within Ashburton's neighbourhood activity centre, which includes a Woolworths, Terry White Chemmart and KFC all nearby, plus Chadstone Shopping Centre to the south.
“The location is surrounded by a number of leading schools including Ashburton Primary, St Michael's Primary, Parkhill Primary and Ashwood Secondary College, providing excellent synergies for families.
“There are also parks and parklands, and Ashburton Pool and Recreation Centre close by.”
Ashburton features strong demographic fundamentals with a median house price of $2,005,000, according to REA Group, supporting both spending power and land values in the region, Liu added.