The largest strata healthcare sale in recent Victorian history and one of the largest in Australia since 2021 has occurred and to a buyer profile, many would not have expected. The Manningham Medical Centre has been unconditionally transacted for $45,000,000 to a private investor.
The trophy Day Hospital and Medical Centre located at 200 High Street, Templestowe Lower was sold by CBRE’s Australian Healthcare and Social Infrastructure team of Sandro Peluso, Jimmy Tat and Marcello Caspani-Muto via an international expressions of interest campaign which attracted interest from a variety of domestic and international REITs in addition to private capital.
The Manningham Medical Centre represents one of the most popular healthcare hubs in Melbourne’s east, with a mixture of anchor tenancies including day surgery, general practice, radiology, pathology, dental and a host more. The property is a core medical hotspot for much of Victoria’s outer east and is highly trafficked at all times of the day. Positioned at the corner of Manningham Road offering significant street exposure, the medical centre is one of the most easily recognised healthcare assets in the country.
Part of Australian Unity’s Healthcare Property Trust, the subject property which is strata titled was constructed in 2002/3 and has recently undergone a substantial refurbishment to common areas in addition to a number of recent tenancy expansions and fit-out updates. The property features a gross floor area exceeding 5,000 sqm across 6 levels and a passing income of circa $2,900,000*.
The strata sale reflects a passing yield of circa 6.4% which is significantly sharper than the recent outcome achieved by NorthWest Healthcare Properties during their sale of the Epping Private Hospital which was sold at a passing yield of circa 7.15% and was freehold titled in nature.
CBRE’s Sandro Peluso said, “The Victorian Healthcare investment market has been starved of high-quality opportunities the likes of this for a number of years. Our team have seen the lions share of notable medical assets being transacted across QLD/WA and SA since 2020 so it was not a surprise the property was well-competed for. There are a number of established intuitional level buyers across the healthcare market, however, the number of traditional “core” funds now transitioning toward social infrastructure real estate cannot be undersold, both domestic and international.”
“Furthermore, private capital cannot be ignored, particularly with the state of the current debt market. Offers were received from a mixture of buyer profiles across these categories with the end purchaser a private family who purchased the property unconditionally.”
Jimmy Tat added, “We continue to see private Asian buyer interest for assets anywhere up to circa $80,000,000 from private families, with these groups usually having some form of local representation. The volume of private money in the market is as significant as we have seen in years from international buyers. We are also assisting a number of traditional REITs across Singapore and Japan with their due diligence into Australian social infrastructure-related investments. A number of these groups have already started competing in our sales campaigns but we expect this figure to increase further as we enter 2024.”