Portfolio of 3 Specialist Disability Accommodation assets across SEQ sold

The properties, which sold for a total of $12,346,000, included:

• 29 Hocking Street in Arundel (Gold Coast, Qld) – Six premium self-contained apartments + (OOA & Sprinklers), constructed over three levels, strata titled on a freehold 589sq m site situated within the northern Gold Coast suburb of Arundel.
• 65 and 65A Queenstown Street, Boondall (Brisbane, Qld) – Two premium grade, two-bedroom houses + (OOAs & Sprinklers) & one one-bedroom villa (Sprinklers) on 2 freehold lots totalling 1,012 sqm in the northern Brisbane suburb of Boondall.
• 18 Savannah Street, Redcliffe (Moreton Bay, Qld) – One three-bedroom house + (OOA) on a freehold 607sqm site within 700m of Redcliffe Hospital.

The assets in the portfolio were available for purchase in one line or individually and following the sales campaign the Redcliffe asset was purchased by a private investor, while the Arundel and Boondall assets were purchased by an institutional buyer on behalf of a domestic sovereign fund.

The deals were negotiated by Knight Frank’s Clem Stack and Sam Biggins on behalf of a private partnership.

The portfolio is well occupied, and all four properties have been built to the latest High Physical Support (HPS) design standards, include an Onsite Overnight Assistance (OOA) and incorporate the latest assistive technology.

Mr Biggins said the transactions highlighted the depth of buyer demand for high-quality SDA assets and the importance of tailoring transaction strategies to accommodate varying capital sources, risk appetites and acquisition processes.

“Our sales campaign attracted interest from a broad range of capital sources, including private investors, family offices and institutional investors, each with differing acquisition criteria and transaction protocols,” he said.

“While initial institutional interest centred on acquiring the portfolio in one line, the absence of Class 3 certification at the Redcliffe asset, which classifies it as a group home, increased execution risk for the leading institutional bidder.

“Through a targeted campaign and active management of multiple buyer groups, Knight Frank successfully secured a private investor purchaser for the asset at a price premium and on an unconditional basis. The strength of demand was evidenced by three additional private investor underbidders prepared to proceed under back-up contract arrangements.

“Following completion of due diligence, the remaining Arundel and Boondall assets were successfully transacted with an institutional purchaser on behalf of a domestic superannuation fund representing a blended net yield of 8.15%.”
Mr Stack said the campaign had resulted in more than 71 enquiries, with $30 million in unsatisfied capital at the end.

“The SDA sector is increasingly being recognised as a compelling healthcare property asset class,” he said.

“Investors are selective when looking for assets, focusing on high-quality properties with features such as Class 3 Certification, full building automation and transitional care capability.

“Location is also critical, with assets positioned within inner metropolitan and major regional growth areas with strong surrounding residential values and close to health services attracting significantly higher interest from investors.”