Childcare Market & Operators In Australia

• The recent increases in supply are beginning to moderate to more sustainable levels in line with demand requirements

• A ‘catch-up’ of supply was required, given the number of children utilising LDC has increased by 24% since 2010 whereas the number of LDC centres has only increased by 18%

• Operators remaining cautious, with rigorous assessments being completed before pre-committing new sites

• Isolated pockets of over-supply are evident but in small numbers. The “ripple effect” is low

• Calendar year 2017 saw an increase of 318 new LDC centres, an increase of 4.5% and well above historical growth rates

• A supply spike occurred in early 2017, with new supply levels moderating to near long term average levels towards the end of 2017

• Real DA’s (i.e. commenced or firm) indicate a moderate pipeline over next 12 months

• Bank funding for developers and operators continues to tighten, which is placing pressure on new supply

Slide 1: Canaccord, Folkestone, 2018; *excluded June 2018 data
Slide 2: Canaccord, Folkestone, 2018; *to 31 May 2108

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