Opportunity to Secure Lease at New Childcare Centre in Glenroy

The opportunity to secure a lease for a new childcare centre in Glenroy is being hotly contested by numerous leading service providers, from boutique operators to substantial private and listed entities, according to CBRE’s Sandro Peluso.

The centre, located at 34-35 Finchley Avenue, includes a fully refurbished heritage cottage featuring a substantial modern extension, with permit approval for 121 children across 1,600sqm of indoor space and outdoor play area.

The property is being marketed by CBRE’s Australian Healthcare & Social Infrastructure team of Sandro Peluso, Jimmy Tat and Marcello Caspani-Muto. The team have leased 11 childcare centres in 2024.

Mr Peluso said the already tight leasing market is set to become even more competitive in 2025.

“There has been, and will continue to be, a significant reduction in the amount of earmarked or permit approved childcare centers being built across the country. We are seeing this slowdown firsthand from a leasing perspective and it’s supported by data from our market analysis which indicates a substantial drop in new centre supply in 2024 and beyond. This is no surprise given the well-documented construction cost challenges all developers are facing across commercial property,” he said.

“What this means is there is reduced opportunity for tenants to build increased scale which has resulted in increased enquiry, competition and ultimately new rental benchmarks being set across the leasing market,” Mr Peluso added.

Mr Tat noted the location of the property, in one of Melbourne’s high-growth corridors, was a key factor in the significant interest from a range of service providers looking to secure the lease.

“The demographics across Glenroy are positive, and it’s an area that will benefit substantially from a new premium offering. There are also over five schools within this project’s immediate catchment which seems to be the biggest driving force for tenant interest to date,” he said.

“It’s critical for operators to commit to well-capitalised developers as we do see several projects not commencing post lease execution, resulting in missed opportunities and wasted financial resources. The developer of this project ticks these boxes and is helping progress provider interest in the project at a rapid rate,” Mr Tat added.