Childcare centre in Melbourne's Sunshine West on the market
A Sunshine West childcare centre is on the market with expectations in the mid-$3 million range as demand from investors for the secure lease profiles on offer in the sector is seeing yields tighten.
The 2 David Drive property comprises a purpose-built centre, with a 703 square metre building licensed for 93 places.
The 2,216 square metre site is leased to ASX-listed operator G8 Education and includes outdoor playing areas.
G8 Education Limited is a national operator with more than 450 child care centres. It has a 10-year lease expiring November 2018 with two five-year options at $198,061 per annum.
According to marketing agents, Savills’ Julian Heatherich and James Lockwood, the property will test the market in a strong education precinct comprising eight primary schools and five secondary schools.
Lockwood said the sheer number of investors clamouring for a piece of the childcare centre action had seen yields fall continuously over the last 18 months, with yields in Melbourne now as low as 3.89 per cent.
"What has worked so well for childcare centres, apart from the obvious growth industry aspect, are the secure lease profiles, usually to national operators, and the prime, main street, locations,’’ Lockwood said.
