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New Zealand Childcare Investment with Stable Returns

A high-yielding freehold investment in the childcare sector, located in an established and growing community in the South Island.

This purpose-built facility, operating as The Learning Barn, is licensed for 70 child placements and sits on a generous 3,580m² parcel of land, offering significant long-term value through both stable income and future development potential. The property delivers a net income of $175,000 per annum, with the tenant covering 100% of outgoings.

Purchase Details
Asking Price
2517885
Purchase Price
2350000
Deposit (assuming
65
% debt)
822500
Stamp Duty
Nil
Building Report*
995
Solicitor Cost*
6000
Valuation*
3500
Other fees*
44650
Other Fees* (Depreciation
report, bank fees)
2517885
Total Cash Required
877645
Purchase Price + Purchasing Costs
2405145
Net Annual Cash Flow Return
175000
Net Yield on Property
7.45
%
Net Yield Accounting for
Purchasing Costs
6.91
%
Cash-On-Cash Returns
Deposit Needed =
% + Costs
887645
Cost of Loan
(Assume
6.59
% pa on
65
% debt)
95468
CASH FLOW AFTER
MORTGAGE COSTS
Return of Equity
(Pure cash flow return)
9.06
%
Return of Equity with a
5% Capital Growth Rate:
24.27
%
Return of Equity with a
7% Capital Growth Rate:
29.62
%
Return of Equity
10% Capital Growth Rate:
%
*approximate numbers

Key Highlights

• Freehold childcare asset delivering a strong 7.25% net yield

• Purpose-built American-style barn completed in 2019

• Structured for minimal management, with low capital expenditure required

• Future expansion or subdivision potential

• Located in a family-focused, affluent residential precinct with sustained population growth

Childcare assets remain one of the most reliable commercial property sectors, offering investors consistent, inflation-aligned rental growth. This asset presented our client an opportunity to secure a high-performing, low-maintenance investment below replacement value, with both secure cash flow and strategic upside.

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