![]() Asset Class: | Childcare |
![]() Price: | $ 3370000 |
![]() Net Yield: | 5.88 % |
![]() Net Yield - including solar strategy: | % |
![]() Property Market Status: | Off Market |
<p class="mb-4"><strong>Significantly under-rented Childcare Opportunity at only $2,917/ Child With Rental Yield Increasing From 5.88% to 6.12% on 1-July</strong></p><p class="mb-4"></p><p class="mb-4">We’re excited to present an exceptional off-market childcare investment opportunity with strong rental upside, backed by a secure long-term tenant.</p><p class="mb-4">This purpose-built centre is leased to Affinity Education Group, one of Australia's leading childcare providers. Affinity has been operating at this site since 2014, having taken over the lease from the current vendor, who previously operated the centre.</p><p class="mb-4">The centre is licensed for 68 places and currently generates a net rental income of $198,324 per annum. A scheduled 4% annual increase on 1 July will lift the income further, resulting in a net yield of 6.12%.</p><p class="mb-4">With a current rate of $2,917 per licensed place, there is clear rental uplift potential. This figure sits well below the market median of $3,600 to $4,000 per child, providing scope for future adjustment. This opportunity can be realised when the lease—which has no further options—expires in July 2032.</p><p class="mb-4">The childcare sector remains one of the most resilient asset classes, underpinned by strong government support. For every dollar invested in childcare, it is estimated that the economy sees a $2 return. The sector’s importance was underscored during the COVID-19 pandemic, when it was among the first to receive direct government subsidies.</p><p class="mb-4">This is a rare chance to secure a quality asset in a highly sought-after sector with built-in growth potential and a national tenant.</p><p class="mb-4"></p><p class="mb-4"><strong>What We Like About This Asset</strong></p><p class="mb-4"></p><ul class="bullet-list"><li><p class="mb-4">Low price-point for childcare at $3.37M</p></li><li><p class="mb-4">significantly under-rented at $2,917/child > market rates sit between $3,600 - $4,000/child</p></li><li><p class="mb-4">market rent review 1-July 2027 as per lease</p></li><li><p class="mb-4">Australia’s third-largest provider of early education and childcare service (255 early learning centers)</p></li><li><p class="mb-4">Complete refurbishment ($250k) of yard completed in 2023</p></li><li><p class="mb-4">brick & tile construction</p></li></ul>
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How long has the current tenant been on site?
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Is this lease a leaseback arrangement?
<p class="mb-4"><strong>Family Desirability & Socio-Demographic Profile</strong></p><p class="mb-4">Canning Vale is a highly sought-after suburb for families, known for its peaceful streets, quality schools, and abundance of parks and recreational spaces. With a typical household size of 3.1 people, it reflects a strong family-oriented community. The suburb offers a mix of modern housing, shopping centres, and easy access to transport, making it both convenient and family-friendly. Its blend of lifestyle and amenities continues to attract young families and professionals, affirming its reputation as a desirable place to live.</p><p class="mb-4"></p><p class="mb-4">According to the 2021 Census, Canning Vale had a median weekly household income of $2,277, which is higher than both Western Australia's median of $1,815 and the national median of $1,746. The suburb had a population of 34,504, with a median age of 37 years. Households in Canning Vale averaged 3.1 people, indicating a family-oriented community.</p><p class="mb-4"></p><p class="mb-4"><strong>Population & Kids Ratio</strong></p><p class="mb-4">According to the 2021 Census, Canning Vale had a total population of 34,504, with 1,910 children aged 0-4 years, accounting for 5.5% of the population, indicating high-demand for childcare services.</p><p class="mb-4">There are 10 registered childcare centres within the Canning Vale precinct, according to a Google Maps search. These range from small, privately operated services to larger, well-established centres catering for up to 100 children. This mix reflects a healthy balance between local demand and available supply in the area.</p><p class="mb-4"><br></p>
Additional Location Information File<p class="mb-4"><strong>Affinity Education Group Limited AKA Milestones Early Learning Centre</strong></p><p class="mb-4"></p><p class="mb-4">Affinity Education Group Limited, a major player in Australia's early childhood education sector, maintains a strong financial position. In 2023, the company reported revenues of approximately $552.8 million and a net profit after tax of $13.7 million, marking a 35% increase in revenue and a 20% rise in pre-tax profit compared to the previous year. <u>The Sector</u></p><p class="mb-4">The company's financial stability is further evidenced by its cash reserves of $53.5 million as of December 2023. However, it also carries significant borrowings totaling $563 million, comprising a syndicated debt facility maturing in 2026 and unsecured loan notes due in 2027. <u>The Sector</u></p><p class="mb-4">Milestones Early Learning Centres provide high-quality early education and care for children aged six weeks to five years. They offer tailored programs that support each child's individual needs, interests, and developmental milestones, creating a nurturing environment that feels like a home away from home. </p><p class="mb-4"></p><p class="mb-4"><u>https://milestones.com.au/</u></p><p class="mb-4"><br></p>
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<p>This childcare investment presents a compelling financial proposition with <strong>immediate returns and built-in growth potential</strong>:</p> <ul> <li>Purchase Price: $3,370,000</li> <li>Current Net Rent: $198,324 per annum + Outgoings + GST</li> <li>Current Net Yield: 5.88%, increasing to 6.12% from July 2025</li> <li>Fixed Annual Increases: 4% providing predictable income growth</li> <li>Triple-Net Lease: Tenant responsible for 100% of outgoings (approx. $19,000 p.a.)</li> <li>License: 68 places at $2,917 per child</li> <li>Security: 4 months bank guarantee</li> </ul> <p>The current rate of $2,917 per child sits <strong>significantly below market</strong> compared to nearby centres charging between $3,600-$4,000 per child, highlighting substantial rental upside potential when the lease expires in 2032.</p> <p>Recent capital improvements include a complete $250,000 refurbishment of the outdoor play area completed in 2023, enhancing the property's appeal and functionality without additional investment required from a new owner.</p>
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<p class="mb-4"><strong>14 Alexandria Boulevard, Canning Vale - 68 places - $2,917/child</strong></p><p class="mb-4">18 Pattie Street, Cannington - 78 places - $4,226/child (Little Moppets Early Learning)</p><p class="mb-4">1 Ecyclia Boulevard, Treeby - 92 places - $3,753/child (Nido)</p><p class="mb-4">9 Westfield Road, Camilo - 92 places - $3,578/child (Early Learning)</p><p class="mb-4">331 Elevent Road, Hilbert - 86 places - $4,069/child (Nido Early School)</p><p class="mb-4">148 Parkway Rd, Bibra Lake - 92 places - $3,674/child (Treasured Tots)</p><p class="mb-4">2 Walter Rd, Byford - 75 places - $3,500/child</p><p class="mb-4"><br></p>
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<p class="mb-4"><strong>Purchase Price: </strong>$3,370,000 (negotiated)<br></p><p class="mb-4"><strong>Market Status:</strong> Off-Market</p><p class="mb-4"><strong>Current Net Rent:</strong> $198,324pa + Outg + GST (incl mng)</p><p class="mb-4"><strong>Current Net Yield:</strong> 5.88% (incl mng) > 6.12% (incl mng) from 1 July 2025</p><p class="mb-4"><strong>Number of Places:</strong> 68</p><p class="mb-4"><strong>Rate per Child</strong>: $2,917/child</p><p class="mb-4"><strong>100% Outgoings Recoverable:</strong> Yes, incl mng and land tax</p><p class="mb-4"><strong>Age of Asset:</strong> 1997 (approx. 28 years)</p><p class="mb-4"><strong>Are Seller & Tenant Related:</strong> No</p><p class="mb-4"><strong>Occupancy Rate:</strong> in the range of 60-75%, most centers break even from approx 30%</p><p class="mb-4"><strong>Flood Zone:</strong> No</p><p class="mb-4"><strong>Bushfire Zone:</strong> No</p><p class="mb-4"><strong>Contamination:</strong> No</p><p class="mb-4"></p><p class="mb-4"><strong>Asset Composition: </strong></p><ul class="bullet-list"><li><p class="mb-4">1,449sqm Freehold (green title)</p></li><li><p class="mb-4">Brick and tile dwelling</p></li><li><p class="mb-4">68 places</p></li><li><p class="mb-4">3 play rooms with wet area</p></li><li><p class="mb-4">1 Sleep area</p></li><li><p class="mb-4">1 Office room</p></li><li><p class="mb-4">1 Staff Room</p></li><li><p class="mb-4">1 Kitchen</p></li><li><p class="mb-4">Outdoor area with play equipment</p></li><li><p class="mb-4">10 car bays (staff and drop-off)</p></li><li><p class="mb-4">Refurbishment of yard completed in 2023<br></p></li></ul><p class="mb-4"><strong>Infrastructure Level:</strong> Tier 1<br></p><p class="mb-4"><strong>Tenant Highlights:</strong></p><ul class="bullet-list"><li><p class="mb-4">Tenant - Affinity Education Group (Milestones Early Learning Sanctuary Waters)</p></li><li><p class="mb-4">Lease Expiry 1 July 2032, no option</p></li><li><p class="mb-4">Fixed annual increase at 4%</p></li><li><p class="mb-4">market rent review 1-July 2027</p></li><li><p class="mb-4">100% of outgoings paid by tenant (incl mng & land tax)</p></li><li><p class="mb-4">Security: 4 months bank guarantee</p></li></ul><p class="mb-4"></p><p class="mb-4"><strong>Agent Questions:</strong><br></p><p class="mb-4"><strong>Have you got an outgoings breakdown (water, council, insurance)?</strong> Outgoings total approx. $19k per annum. Details will be supplied once contract accepted.</p><p class="mb-4"><strong>Why is the owner selling?</strong> Wants to divest money.</p><p class="mb-4"><strong>Is the tenant related to the owner in any way?</strong> No</p><p class="mb-4"><strong>Has the tenant been paying rent on time?</strong> Yes – the owner manages the property themselves however Lease allows for Management Fees to be recovered from tenant.</p><p class="mb-4"><strong>Are you aware of any significant defects that may come up in the building inspection?</strong> None</p>