If you are thinking about selling your daycare centre, you might be wondering: is now a good time to sell? The answer, in short, is yes. The Australian childcare sector is currently one of the most active business markets, with high demand from buyers and strong prices. In this blog, we break down recent sales trends and explain what they mean for your centre’s potential value.
Childcare Sales Reached Nearly $1 Billion in 2024
In 2024, the total value of childcare centre sales in Australia reached nearly $998.5 million, almost 30% higher than in 2023. The market has bounced back after COVID and is gaining momentum again. This level of activity means more buyers, more competition, and more opportunities for sellers, especially those with well-run centres.
Big Investors Are Driving Prices Up
Larger investment groups and commercial property trusts are entering the childcare market in a big way. They are drawn to long-term leases (10–20 years), reliable income supported by government subsidies, and the essential, family-focused nature of the industry. For example, a centre in Cremorne, Melbourne sold for $18.5 million, and a group of seven centres in New South Wales sold for $55.2 million. These premium deals show the industry is not only growing but is also being taken seriously by some of Australia’s biggest investors.
Yields Are Dropping, Values Are Rising
One way to understand price trends is through capitalisation rates (yields). A yield is the return a buyer expects from a property. When yields decrease, prices generally rise. In 2024, yields on childcare properties dropped to around 5.3%, down from 5.7%. Some top centres sold at yields as low as 4.3%–4.9%, very strong results.
📌 What this means: Buyers are willing to pay more for stable childcare centres with long-term income. If you own both the business and the property, your centre could be worth significantly more. Even if you are selling only the business, the active and optimistic market is good news.
Not Just Property: Leasehold Businesses Are Selling Too
You do not need to own the property to benefit from a strong market. Childcare business-only sales (leasehold) are also in demand. These centres typically sell for three to five times their EBITDA (profit before certain costs). For example, a centre earning $300,000 in annual profit might sell for $1 million to $1.5 million. In 2022, a group of 12 centres sold to Affinity Education for more than $40 million. In 2021, a Perth-based chain sold 14 centres to Busy Bees for $40 million. These deals show that major childcare providers and private investors continue to buy, even without real estate included.
Freehold vs Leasehold: What’s Hot Right Now?
Freehold childcare centres, where the buyer acquires both the business and property, are especially popular with investors. These centres come with long leases, strong tenants, and consistent rent, making them a safe investment. Leasehold centres, which involve only the business, are more dependent on performance factors such as occupancy, fees, and profitability. Both markets are strong, but different buyers look for different things. Well-priced centres, whether freehold or leasehold, are currently selling within six to twelve months, often faster if they are well-prepared.
The Industry Has Bounced Back After COVID
After the disruptions of 2020 and 2021, the childcare sector has recovered strongly. Occupancy rates are up in most areas, the government increased the Child Care Subsidy in 2023, banks are actively financing childcare again, and more parents are returning to work. One finance expert described the current conditions as a “perfect storm” of good news for daycare owners: steady demand, strong subsidies, and buyers with funding ready.
Bottom Line: It’s a Seller’s Market
If you are considering selling your daycare business, now is an excellent time to explore your options. There are more buyers than ever, sale prices are strong—especially for well-run centres—and even centres still building enrolments are attracting interest if they are in high-demand areas. Buyers are sophisticated, however. They will pay top dollar only for centres with strong fundamentals: good location, high occupancy, clean finances, and stable staff. If you want to know where your centre stands in today’s market or how to improve its value, reach out to Mollard Advisory. We specialise in helping daycare owners sell with confidence.
Frequently Asked Questions About Recent Daycare Sales and Market Trends
1. Why are yields dropping in childcare sales?
Yields are dropping because buyers are willing to pay more for the same income. This indicates that childcare centres are seen as low-risk assets. Strong investor demand, stable government subsidies, and long leases make the sector very attractive, which pushes prices up and yields down.
2. Will this positive trend continue in the future?
The outlook remains strong, with government support increasing, population growth in the 0–5 age group, more parents returning to work, and childcare viewed as recession-resilient. However, external factors like interest rate changes, new competition, or policy shifts could slow growth. If you are considering selling, it is wise to take advantage of current demand while it remains high.
3. Does owning the property make a big difference when selling?
Yes. Owning the property (freehold going concern) often increases the sale price because buyers get both the business and the land. This eliminates landlord risks, provides long-term control, and attracts more types of buyers, including investors.
4. Are large investors only buying big centres?
Not always. While major groups often target larger centres (70+ places), there is still strong demand for small and medium-sized centres, especially in high-growth or regional areas with strong occupancy and management. Boutique centres with strong reputations can be just as attractive as larger sites.
5. How long does it take to sell a daycare right now?
Centres in good locations with strong financials are selling in six to twelve months, sometimes faster. The timeline depends on performance, lease quality (for leaseholds), financial transparency, and whether a specialist broker is involved. Better preparation typically means a quicker and smoother sale.