Childcare centres likely to take the spotlight at Burgess Rawson auction

Prateek ChatterjeeMarch 31, 20160 min read

Childcare centres are hot property, with four to be auctioned off among 19 offerings at Burgess Rawson’s next portfolio auction in Sydney on April 5.

Hubba Bubba childcare at 204 Mowbray Road, Chatswood has over 185 enquiries and 45 contracts issued.

This is a 26-place childcare centre with 100% occupancy.

The freehold 696-sqm site centre earns a net of $94,000 pa plus GST. 

The tenant is on a 15-year lease expiring January 2026 with two further 10-year options to 2046 with annual rent increases. Net lease with tenant paying all outgoings and also responsible for all repairs, maintenance and replacement.

Chatswood is one of Sydney's sought after locations, and is only eight km north of Sydney CBD. Its population is projected to grow by 54% by 2036.

There is strong interest for the Freshwater and Prairewood centres too, with enquiries numbering over 80 and 15 contracts issued respectively.

The centre at 10/4-8 Waine Street, Freshwater has 80 places with 100% vacancy and a waiting list.

It is part of a brand new building constructed in circa 2013; approx $1.85 million depreciation available. No land tax due to Childcare Centre exemption.

The 1,241 sqm centre is on a 10-year lease expiring in 2023 plus options to 2038.

It earns a net income of $296,129 pa + GST.

The operator is growing to six locations including Northern Beaches, Inner West, North Shore.

The Prairewood centre is at 6 Pierce Close and is a 40-place facility which was upgraded in January 2016.

Dominant centre established in 1995 and at 100% occupancy.

It is on a new 20-year lease to 2036 with two further 10-year options to 2056.

The net income is $110,000 pa plus GST with 3% annual rent increases.

The tenant pays all outgoings.

It is close to schools and transport routes.

Located in the Fairfield LGA which boasts a strong resident population of circa 200,000 and is forecast to grow by over 8% by 2031, gross regional product of $6.77 billion. 

Other offerings at the auction include a pharmacy and Crust Pizza investment in Annandale which has drawn over 160 enquires and 35 contracts issued.

Hungry Jack’s in Griffith NSW and a McDonald’s in Childers QLD are set to record tight yields in “affordable price brackets” of sub-$3million range. 

The Sydney event is Burgess Rawson's 103 portfolio auction.



Prateek Chatterjee

Commercial Auctions
Sydney Auctions
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