An elevated view of 71 Roseberry Ave, Birkenhead, leased to a Lollipops early childhood education centre.
An elevated view of 71 Roseberry Ave, Birkenhead, leased to a Lollipops early childhood education centre.
A modern childcare centre with a new, long term lease to a well-established and publicly listed tenant is now on the market on Auckland's North Shore.
Peter Kermode, Shoneet Chand and Jimmy O'Brien of Colliers International are marketing 71 Roseberry Avenue, Birkenhead, for sale by auction at 11 am on Wednesday October 28 unless it sells earlier by negotiation.
"The strong tenant covenant and attractive lease terms make this an appealing long term investment," says Kermode.
"The freehold, two-level complex is leased to Evolve Education Group (EEG), trading as Lollipops, on a new 15 year lease that starts this month. The lease generates a net annual income of $134,160 and gives investors annual, fixed increases of 2.5 per cent with two rent reviews every five years to market.
"A hard ratchet clause is part of the agreement which means the rent cannot fall below current rates," Kermode says. "This paired with all outgoings being paid by the tenant reflects positively for investors as rent can never go down while the high level of quality is maintained by the tenant."
Kermode says EEG is a New Zealand owned and operated provider of high-quality, multifaceted Early Childhood Education services operating under various brands including Lollipops Educare, PORSE and Au Pair Link.
"EEG has more than 86 centres nationwide and is listed on the New Zealand Stock Exchange with a market capitalisation of about $150 million."
The original, 1982, concrete block base, timber floor building was comprehensively redeveloped and modernised in 2008 for its conversion to a childcare centre.
The 634 sq m property is split over two levels, each with its own, generous, covered outdoor areas.
The play centre area within Lollipops at 71 Roseberry Ave, Birkenhead.
The decking has a waterproof membrane beneath AstroTurf which creates a weatherproof covered outdoor area over the lower level outdoor play area. Exterior cladding is a mix of brick and ply with aluminium joinery and long run iron roofing.
Chand says the fully subscribed childcare business is licensed for up to 60 children and has a waiting list until June next year.
"EEG's stated objective is to become the leading provider of Early Childhood Education services in New Zealand, and it is committed to providing education and childcare services that are second to none.
"Government funding to Early Childhood Education has also increased significantly over the last eight years signalling a shift in prioritising early education services.
"Early education has emerged as an essential service and accordingly, we should continue to see exponential growth in demand for quality service providers."
Chand says with a potential final expiry lease period of 2040, the childcare centre offers certainty of location, which appeals to surrounding families and affords prospective investors even greater confidence.
O'Brien says the property in Birkenhead just 10 kilometres from the Auckland CBD has an ideal setting and sought-after north facing aspect for its use as a childcare centre.
"Roseberry Ave is a quiet street running through a lush, north facing valley and is characterised by stand-alone residential houses.
"The site is also surrounded by a small ring road that has good public car-parking right at the doorstop.
