Child-care centre deals worth $10.7 million sealed in Melbourne this week

A former church in Heathmont will be redeveloped as a child-care centre

Two child-care related deals were sealed in Melbourne this week.

In the north-eastern suburb of Greensborough, the St Helena Early Learning Centre at 189 St Helena Road (pictured, top) has exchanged for $7.26 million – a deal reflecting a 5.95 per cent passing yield.

The 4224 square metre parcel containing a 1891 sqm purpose-built facility (including an outdoor play area and car park), and licensed for 120 places, sold to a private investor. It was offered with a 15-year lease.

“Amid reporting about a general oversupply of centres, demand from investors in some metropolitan areas remains strong,” Fitzroys marketing agent Chris Kombi said.

State of the art complexes, such as 189 St Helena Road, which include large, valuable underlying land holdings are particularly attractive, the broker added.

Childcare Operators, which trades as St Helena Learning Centre, has spent more than a decade in the construction and operation of child-care centres.

“The property’s build and selected location reflected their experience in the industry, and investors took note of this in big numbers,” Mr Kombi said.

The broker marketed the property, 19 kilometres from the city, with colleague Terence Yeh and CBRE’s Sandro Peluso and Jimmy Tat.

“We are seeing some big results of late in the sector driven by the fast paced growth in the 0-5 age group population which is destroying the notion of an oversupply, as does the retreat of bank funding, which played a big part in boosting supply initially through large injections of capital,” Mr Peluso said. “The participation levels of parents and children are also increasing, with more mothers choosing to go back to work, boosting demand”.

Mr Yeh said the Greensborough investment is strategically located to a number of primary schools within two kilometres.

Meanwhile, in Heathmont, 24 kilometres east of the city, a development site at 203-205 Canterbury Road (pictured above, left) has sold to a child-care group.

The former church sits on a 2970 sqm plot zoned Neighbourhood Residential 3.

Gross Waddell selling agent Andrew Thorburn said the price of $3.4 million valued the land at $1145 per sqm.

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Marc Pallisco

A freelance property analyst and journalist, Marc is a co-founder of realestatesource.com.au.

Marc Pallisco