Perth childcare centre changes hands for a record price

A near-new childcare centre in Maylands has changed hands for $7.2 million. The sale is part of HMC Capital’s strategic asset recycling program with proceeds redeployed into its accretive development pipeline.

The property, located at 135-137 Peninsula Road, is leased to Nido Early School for a 20-year initial term.

The sale was driven by CBRE’s Australian Healthcare and Social Infrastructure team of Sandro Peluso, Jimmy Tat and Marcello Caspani-Muto in conjunction with Sterling Property's Jake Wallman and Simon Brady.

Mr Peluso said the sale was the largest ever single childcare transaction in Western Australia.

“The WA market has been underappreciated from a childcare investment perspective for a substantial period of time,” he said. “While land values are naturally lower, operational performance is incredibly impressive as only a few large-scale operators have a presence in the WA market. Nido Early School are a key example of a leading operator in this space - the majority of their services operating for more than 12 months have over 90% occupancy. Demand in most areas of WA is fairly under serviced so continued long-term centre profitability remains strong and is a key attraction for investors from all over the country.”

The childcare centre is licensed for 112 places and has a total land area of 1,972sqm. The tenant, Nido Early School, was listed on the ASX late last year and has 46 modern and high occupancy centres across WA with more scheduled to open later this year and in early 2025.

Mr Brady added, “The childcare sector continues to demonstrate sustained growth, underpinned by strong population growth and Federal Government support of families and early childhood educators alike. Investors, developers, and operators continue to be active in the current market to help meet demand in core locations. This transaction demonstrates the ongoing investor demand for well-located childcare investments with strong lease covenants, with the purchaser attracted to the inner-city location and national operator.”