Childcare demand underpins $1b in learning centre sales

A Walkerston early learning centre has sold for almost $2 million in what a commercial real estate agency says is a sign of ongoing demand in the sector.

Burgess Rawson sold 328 freehold childcare properties over the past decade with 73 in Queensland selling for a combined $208.1 million.

This included the Walkerston Daycare which sold for $1.97 million in August last year.

Burgess Rawson principal Pat Kelly said the childcare properties were a strong investment unscathed by the COVID-19 pandemic.

“During the national peak for COVID-19, the government’s importance on supporting the childcare industry was made very clear,” Mr Kelly said.

“Some of the earliest specialist assistance packages were directed to the industry, a strong pull for investors seeking reliable assets for the long-term.”

Mr Kelly said family demand for childcare would continue to fuel investor demand.

“There is no question there are more and more families seeking access to quality childcare, with a strong economic return of workforce participation far outweighing the cost to assist in childcare funding,” he said.

The company’s 2020 report forecast the Australian childcare industry would grow by 2.2 per cent to $12.4 billion over the next five years.

“Childcare as an asset class continues to offer attributes that investors are favouring such as long net leases, quality tenants underpinned by land value and intrinsic business value,” the report stated.

“As a result, we predict childcare being a favourite for the post COVID investors’ world.”

Written by Heidi Petith, The Daily Mercury