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News Release

Rising Star of childcare investments

JLL marketing 210 White Swan Road, Lynfield



Long term investment with development potential/new-zealand/en-gb/news/916/long-term-investment-with-development-potentialAUCKLANDLong term investment with development potential
Former Fire Station on high profile corner site/new-zealand/en-gb/news/915/former-fire-station-on-high-profile-corner-siteCHRISTCHURCHFormer Fire Station on high profile corner site

A childcare centre in the Auckland city fringe suburb of Lynfield is for sale through JLL agents Kevin Reardon and Alex Wefers. 

Purpose built in 2000, the childcare centre sits on a 1,011sqm corner site. The two level, 333sqm building caters for 54 children and the property has 13 carparks. It will be sold through expressions of interest closing 4pm, Thursday 5 July 2018. 

“The property will provide the new owner with a stable, passive income for the coming four years and is currently returning $121,000 p.a. net, or $43 per child per week. This indicates there may be some rental upside at market rent review in 2022. In the meantime, the lease provides fixed annual increases,” says Reardon. 

“An astute investor will instantly recognise the upside potential here,” adds Wefers. “As a business, a childcare centre has good, stable cashflow. The location allows the investor to participate in and benefit from Lynfield’s growing appeal and rising property values,” he says.

Constructed with concrete flooring, fibre cement wall claddings, timber framing and a steel roof, the building is boomerang shaped, which enables all activity areas to open to an enclosed play area. The lower level is subdivided into three main children’s activity areas and caters for different age groups. It also includes a resource room, laundry, kitchen, first aid room and toilet facilities. The upper level provides a staff break room and administration office.

Having operated under the same management and business name since 2004, the childcare centre is well-established and has become part of the community and neighbourhood and sits alongside local amenities which include a takeaway store, laundromat and dairy. 

“With 14 years’ industry experience at this location, the current tenant has the right to stay for a further 16 years until 2034 if all rights of renewals are exercised,” says Reardon. 

Rising Stars Lynfield is one of two centres under the same management with a second branch in Henderson, demonstrating the managements experience and commitment to the industry. 

“The property is zoned Business Neighbourhood Centre, and along with allowing for higher density, could be utilised for a variety of commercial and residential activities, which future-proofs this location.

“The Labour Government has committed to further investment in childcare and early education, which adds to the security of this investment. The childcare sector remains highly sought after by investors and is tightly held by those who already have ownership. This means when an opportunity such as this does pop up, it represents a great opportunity for those wanting to enter the market t, with the understanding that they may have to compete against those looking to expand their portfolio,” says Wefers.

According to JLL research, the number of children aged 0-4 in Lynfield and the surrounding area is predicted to increase, from 2,770 in 2017 rising to an estimated 3,260 in 2028, an increase of 490 children (18 per cent).

JLL Head of Research, Tom Barclay says, “When we look at the population figures for this area we can see that the average household size is approximately 3.1 people and the average age is 36, which suggests that there is a high prevalence of young families with at least one child or more that live locally. The average household size is slightly ahead of the Auckland average which is 3.0 and well ahead of the New Zealand average of 2.4. 

“Our research tells us there are approximately 952 children currently attending childcare across 23 facilities within a 2km radius of this property. This results in an average centre size of 41. The subject property at 54 children is substantially larger than the average for this area. It is expected that the number of children in childcare will increase, especially following the recent budget announcement which has targeted increased access to early childcare education over the next four years, underpinning this property as a secure investment proposition,” says Barclay. 

Located on the southern side of White Swan Road on the corner of Gilletta Road, the property is in a prime position. It is surrounded by mainly residential properties has ample street frontage to both White Swan Road and Gilletta Road. 

White Swan Road, being a main arterial, sees approximately 22,000 cars pass per day during the working week. 

The suburb is well supported by local schools, including Lynfield College, which is a short walk away. Also only a walk away are a number of reserves with coastline to Manukau Harbour. 

The property sits right on the juncture of three suburbs, Lynfield, Mount Roskill and Blockhouse Bay. Lynfield Mall is one kilometre to the south, Blockhouse Bay is one kilometre to the west and Mount Roskill is approximately three kilometres to the east. 

“All three of these suburbs have experienced a significant rise in capital values over recent years. Access to Auckland CBD takes approximately 12 minutes via suburban roads. However, this has been vastly improved by the completion of the Waterview Tunnel,” says Reardon.