Child’s Play for Savvy Investors in the Nation’s Capital

21 August 2017

In the past two years, the child care market has seen a significant rise in transactions and record yields achieved nationally. This growth has been primarily as a result of increased competition from national organisations looking to expand their portfolios.

In suburban Canberra the market for small to medium commercial properties throughout has remained relatively stable over the past 12 months with the majority of demand generated by owner-occupiers and small investment syndicates.

Whilst demand from investors has also been consistent, a lack of good quality leased stock has resulted in a paucity of transactions. Tight yields continue to be achieved for this class of investment, especially in the inner suburbs.

In light of this, a local private owner is bringing a two storey commercial building to the market, with a 15 year lease to a national childcare provider and two new five year leases to new tenants.

22 Thynne Street is located on a prominent corner within the Fern Hill Technology Park in the Canberra suburb of Bruce. The ground floor is wholly tenanted by Guardian Early Learning Centre until 2029.

The first floor office accommodation has recently undergone significant refurbishment. The works included reconfiguration to three office tenancies, an upgraded common area providing new male, female and ambulant bathroom amenities. There is also a large dedicated car park on site.

The current owners have invested significantly in upgrades to the property, spending in excess of $850,000 in the past few years.

For sale exclusively through Andrew Stewart and LeeAnne Hobbs of Savills, the property has an estimated net income of $464,495 pm (fully leased).

According to Andrew Stewart, Managing Director of Savills in Canberra, childcare centres continue to maintain their status as one of Australia’s most sought after asset classes.

“Yields of 5.50% - 7.30% have been achieved consistently throughout 2016, with a Chatswood sale recording a yield of 3.90%.

“We predict these sorts of properties will continue to attract strong results through the medium to long term nature of their leases and their statutory obligation to be fastidiously maintained” he said.

The property has a CZ5- Mixed use zoning and the Canberra CBD is 7.6km away and the Canberra airport is 14.8kms away from the asset.

Mr Stewart indicated a sale price in excess of $6,500,000 is likely.

22 Thynne Street is for Sale by Expressions of Interest Campaign concluding 4pm Wednesday 6 September 2017.

RLA1786

Click here to learn more about Savills Sales & Investment.

 
 

Key Contacts

Andrew Stewart

Andrew Stewart

Managing Director - ACT

Savills Canberra

+61 (0) 2 6221 8295

 

LeeAnne Hobbs

LeeAnne Hobbs

Director
Asset Management

Savills Canberra

+61 (0) 2 6221 8294