ABC: Childcare landlords are collecting a staggering $2.7b in rent every year while parents' fees rise

The boom is on and childcare has become one of the most profitable plays in Australian real estate — and families are feeling the cost.

As investors rush into the sector, childcare fees are rising sharply. Some parents now pay up to $220 a day, or more than $1,000 a week, to access a system worth more than $20 billion a year and increasingly marked by systemic failures, secrecy, and a rising number of serious incidents inside some for-profit childcare centres.

While some of the childcare fee hikes can be attributed to wage costs, some are due to rising rental costs.

To put it into perspective, between 2018 and 2022, childcare fees rose between 20 and 32 per cent, according to the Australian Competition and Consumer Commission (ACCC), far outpacing inflation and wage growth. The increase coincided with a boost in federal childcare subsidies, now totalling $14 billion a year.

Funding could be fuelling problem

In its latest budget, the Albanese government committed another $5 billion to the sector, including funding for a new building fund, three days of subsidised childcare, and educator wage support.

But experts warn that government funding, without strings attached, is helping fuel a growing private rent economy within childcare, which is impacting the quality of childcare and creating childcare deserts in regional and poorer areas.

New analysis for the ABC by the Centre for International Corporate Tax Accountability and Research (CICTAR) and led by researcher Bronwyn Lee, estimates that childcare landlords collect a staggering $2.7 billion in rent every year.

An ABC investigation revealed a crisis in childcare including neglect, unqualified staff, educators given strict financial sales targets and even kids served 33 cent meals — all to boost profits.

It found in the past decade 95 per cent of all new childcare centres are for-profit and in the long daycare sector, almost three quarters are for-profit.

Listed companies, private equity, property developers and real estate barons are all rushing into the sector.

'Money won't fix this mess'

What's unfolding is more than a property trend, it's a systemic shift. Billions in government subsidies and grants are being pumped into a sector where landlords and investors are reaping big rewards.

But more money won't fix this mess. The National Children's Commissioner Anne Hollonds issued a statement after Four Corners aired saying: "our whole approach to child safety and wellbeing in this country is in desperate need of systemic reform, and this includes our childcare sector."

Meanwhile the Albanese government remains largely silent about how it plans to address the deepening crisis in childcare. While it has committed billions more to the sector, including wages subsidies to address some of the wage issues and a building fund to help tackle so-called childcare deserts, it has stopped short of addressing the structural issues exposed in the Four Corners investigation. When asked to respond to the revelations he called them "deeply concerning" but deflected responsibility to the states.

Source: Adele Ferguson, ABC News, "Childcare landlords are collecting a staggering $2.7b in rent every year while parents' fees rise", published 26 March 2025, https://amp.abc.net.au/article/105098462

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ABC: Childcare landlords are collecting a staggering $2.7b in rent every year while parents' fees rise

Funding could be fuelling problem

'Money won't fix this mess'

A UNIVERSAL WELLBEING PAYMENT FOR NSW

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