Childcare Snatches STAR status
By Helen Sheild
Why buy a Childcare Centre?
Exponential rental growth in childcare assets is outstripping that of all other property sectors, creating a new “golden child” of property investment and prompting a rash of research.
It was declared that childcare centres are Australia’s fastest growing commercial real estate investment class, underpinned by the fact that the economic benefit of workforce participation far outweighs the costs of funding assistance for childcare
Also, most of the federal Government spending in this sector, tipped at $8.8 billion in 2018-2019 and $10bilion by 2019-2020, was paid directly to childcare operators, ensuring operators can pay the rent.
Reason why childcare should be at the top of every investors wish list
- With sharp yields in the current low interest rate environment and excellent lease conditions, childcare centres are Australia’s most desirable new investment class.
- Demand to purchase is high as both local and interstate investors can see the value and attractive yields still on offer
- Childcare assets have a greater ease in obtaining financing, than say service station business and other service businesses
- Childcare centres were seen as higher-yielding lower risk investments, creating a “ growing pool of buyers hungry for childcare business and property investments”
- The long term need for childcare across Australia adds urgency and interest to this somewhat new asset class
Source: The West Australian