Vacant Newport aged care home changes hands for $5.7 million

Mercy Health has sold its vacant aged care home in Newport for $5.7 million, reflecting a rate of $154,000 per bed.

The property, located at 286-296 Melbourne Road, was sold via an Expressions of Interest Campaign by CBRE’s Australian Healthcare and Social Infrastructure team of Marcello Caspani-Muto, Sandro Peluso and Jimmy Tat on behalf of Mercy Health.

Mr Caspani-Muto noted as the volume of vacant aged care homes continues to reduce in market, the buyer profiles continue to widen.

“We are seeing greater competition than ever for these assets across a wide range of users which are not always specific to aged care. In this instance there was competition from NDIS users, aged care operators and healthcare owner occupiers,” he said.

“In the end, the highest and best use remained aged care. Given the notable undersupply of beds in the area and improved height potential there is exciting potential for this property in the coming years,” Mr Caspani-Muto added.

The property, on a 3,178sqm site, had been vacant for close to three years and included two adjoining residential dwellings to allow for expansion or redevelopment into the future. Recent upgrades were made across the 37 rooms and communal amenities.

Mr Peluso said his team had been incredibly fortunate to work with Mercy in what was their fifth sale for the organisation in three years.

“The value of existing improvements continues to demonstrate great returns as more and more people seek the relative ease and immediacy of existing assets. We even had childcare owner occupiers look at the asset to assess the potential of repurposing building as a single level childcare offering, which is a first for us in aged care,” Mr Peluso added.