With a national commercial valuation team, Acumentis has a dedicated group of experts with key specialisation in childcare centre valuations.
Today we meet Amy Frankel, Director Port Macquarie and find out about her specialisation in this asset type and why it personally resonates with her.
How many years have you been a valuer and what is your key specialisation?
I finished uni and became registered in 2014, so eight years as a Certified Practicing Valuer. I’m a commercial valuer and being based in a regional office, Port Macquarie, I cover most commercial asset types. But I am also lucky enough to undertake specialist valuations in the Tourism & Leisure sector (motels and parks) along with childcare and regional neighbourhood shopping centres.
What skills and knowledge are required to become an expert in this area?
I think being a good communicator is extremely important, particularly as a specialist valuer. Undertaking valuations in the childcare sector it’s important to get the whole picture on how the business operates. Sitting down and talking to the client is my favourite part of the process as you really get to drill down on how all the functions of the centre operate.
Since having my own children and using the childcare system, I think I understand the system a lot more now than I did five years ago. This has helped when valuing this style of asset as I also live and breathe it to an extent entrusting my two daughters to educators and a centre. Ratios, educator qualifications and subsidies now actually affect me personally so when valuing a centre, I can relate to some extent to the business owner.
Who commonly needs this type of work?
A majority of the valuation work undertaken in childcare is for mortgage security purposes for banks and financial institutions. In addition, we undertake valuations for clients in childcare who are considering selling, require an insurance valuation (replacement cost estimate) or for taxation purposes.
What is a key insight in the childcare sector?
The childcare sector is currently facing a lot of issues at present, particularly because of the COVID pandemic and a lack of childcare places available. This is adding pressure on existing centres which are often running at 90-100% capacity with extensive waitlists.
COVID, illness, understaffing and pressure for higher pay rates is going to impact operators going forward. Childcare centres that are currently paying above-award wages seem to have more consistent staffing and are not as negatively affected by sicknesses and staffing issues. In contrast, centres that pay award wages have lower staff morale and are facing room closures due to a lack of resources and being able to staff rooms to required ratios.
Federal legislative changes are due to come into place mid 2023 which will increase the Childcare Subsidy (CCS) available to most Australian families. The changes will make care more affordable but will likely add further pressure on centres as occupancy increases. There will definitely be opportunities in areas which currently have an undersupply of places, however, the lack of staffing due to pay rates will continue to restrict new operators in the market.
The pay issue is going to add pressure on operators as there are calls for further minimum increases noting that the fair work commission announced a 4.6% pay rise in June. Several long-term, smaller operators are considering ‘getting out’ of the industry due to the ongoing increases in costs and wages and overall profitability.
Why does Acumentis have an advantage in this area?
Acumentis has such broad national coverage and a dedicated team of specialist Childcare valuers. The team share knowledge and market specific insights including rents and sales data. This knowledge sharing and depth of data held by Acumentis in this segment ensures our valuation is current and accurate.
Meet our specialist Childcare Property team
What is your most memorable day as a valuer?
Valuing a childcare centre is probably one of the only asset classes where I come away from an inspection with a big smile on my face. You are met with smiling little people asking a thousand questions and most of the time following you in a convoy, checking on your every move. It is definitely a feel-good inspection to undertake.
A bit about you! What do you do when you are not valuing property?
I love cooking and entertaining though don’t get to do it near as much as I’d like to! When I’m not working, I’m first and foremost a Mum. We have two beautiful daughters who keep me busy. I try and spend Tuesdays being “just Mum”. It’s a new thing where I’m trying to be more present when I’m with them, so I make sure we have plenty planned for the day… breakfast dates, park and coffee, cooking together… it’s my favourite day of the week.
What is your motto in life?
Quality over quantity… in all facets of my life … work, food, friends, and handbags!