In net-lease investing, you're buying the income as much as the building. With childcare, judging the credit behind the lease takes sector-specific know-how.
Start with the guarantor
The single most important question is who guarantees the rent. A corporate guarantee from a public operator like KinderCare (~$2.7B revenue) or Bright Horizons (~$2.9B) is very different from a single franchisee's personal guarantee. Identify the entity, then assess its strength.
Strong multi-unit operators and corporate guarantors anchor premium pricing; thinner guarantees warrant wider cap rates.
Pair credit with site performance
Even the best guarantor doesn't eliminate the need to check site-level enrollment and rent coverage. A lease is only as durable as the center's ability to pay it from operations.
The strongest assets combine a creditworthy guarantor, a long remaining term, and rent comfortably covered by real enrollment.
The childcare-specific factors
Beyond standard net-lease analysis, childcare adds variables: licensing status, staffing and ratios, local demographics, and competition. These shape whether enrollment — and therefore rent — is sustainable.
Reading all of this together is exactly the expertise a generalist broker lacks and a childcare specialist provides. We underwrite the credit and the center as one.
Find out what your school is worth.
A confidential, no-pressure valuation from a broker who has owned, operated, and sold childcare centers for 30+ years.
