Melbourne, 9 October 2013-A Melbourne-based buyer has purchased an aged care facility in Glen Waverley for in excess of $4 million.
Located at 982 High Street Road, the purpose built, 49-bed residential aged care facility is currently leased to accredited operator, Autumn Care.
CBRE’s Josh Rutman and Jamus Campbell, in conjunction with Cooper Newman’s John Newman and Phil Kadletz, marketed the asset on behalf of appointed seller Pitcher Partners. The property was offered for sale via an Expressions of Interest campaign and attracted 22 offers from a range of local and offshore buyers.
Mr Rutman said the property’s strong tenant covenant was a key selling factor.
“Due to a shortage of quality investment stock in the market at present, properties with a reasonably strong lease covenant, and that are well located, are being very well received by the market,” Mr Rutman said.
“The sale represents an amazingly strong yield, being sub 8%, for a high care residential facility – an asset class that six months ago, would not have had nearly as much interest.”
Mr Campbell said the aged care sector was earmarked for considerable growth over the coming years – a factor that underpinned strong interest in this asset.
“We are seeing a sharp rise in investment across the entire social infrastructure sector including aged care, medical and child care in particular,” Mr Campbell said.
“Investors are becoming more comfortable with this space and are obviously attracted to the higher returns of 8% to 10%, especially with the cost of debt as low as it currently is.”
CBRE has been appointed to market another aged care facility in the coming weeks, with Caulfield Manor – located at 1019 Glen Huntly Road – set to offer great returns for investors.
“The fundamentals of the property are even better than Glen Waverley, and the location and return will make this investment highly sought after,” Mr Campbell said.
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CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2012 revenue). The Company has approximately 37,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 300 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website atwww.cbre.com.au.