A month since Cushman & Wakefield sold a childcare centre for a price reflecting a milestone sub-five per cent yield, rival Burgess Rawson today divested four more.
In its biggest and best deal, an Explorers Early Learning backed complex in Williams Landing traded at a bulk auction event for $10.98m – a 4.75pc net return.
Two more Melbourne investments of this type achieved a similar result – at Noble Park ($6.742m, a yield of 4.78pc) and Truganina ($6m/4.9pc).
A Nido Early School leased asset in Perth’s Balcatta rounds out the four, collecting $4.325m.
That price reflected a 4.99pc return.
“A Hong Kong investor who was bidding over the phone was…the underbidder on both the Noble Park and Williams Landing childcare centres, before purchasing One Early Education Group [in Truganina],” Burgess Rawson’s Zomart He, Natalie Couper and Adam Thomas said.
“Childcare/early education is…one of Australia’s most sought-after asset classes, with the federal and state government’s providing record funding of $10.5 billion in the 2019/20 financial year,” they added.
Last month, the Cushman marketed property at Raymond Terrace, north of Newcastle, traded at a 4.67pc yield (story continues below).
Explorers Early Learning, Williams Landing
The Williams Landing complex, 2 Fogarty Street, contains 1096 sqm of area and is licensed for 168 clients.
Explorers is on a 15 year lease with fixed three pc rent rises; with options, it can stay until 2064.
The agents said the investment has a consistent 95pc-plus occupancy rate.
The 2900 sqm corner block is about 600 metres from Williams Landing Shopping Centre and 20 kilometres from town.
In December, Home Consortium outlaid $6.6m for a new Tarneit facility – reflecting a 5.75pc yield, which the agency said was the sharpest return for an asset of this type in Melbourne’s west since 2017.
Not long earlier, an operator, the Agosta family, pocketed $11.5m from a West Footscray centre offered with a 20 year leaseback. That deal reflected a 5.9pc return based on its gross rent.