How $35m Bendigo investment is changing regional housing for health workers
A purpose-built residential complex that houses essential workers for Bendigo Hospital has sold.
A Bendigo healthcare accommodation complex has sold for more than $35m, highlighting a growing trend of investment in essential worker housing.
The property at 10 Atkins St, North Bendigo was purchased by an undisclosed social infrastructure investor after a competitive bidding process, with interest from private investors, listed residential and healthcare funds, and major syndicators.
The sale was brokered by Colliers on behalf of Morrison, with the fully leased, purpose-built complex including 120 apartments across 11 three-storey buildings.
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The site, which is located just 500 metres from Bendigo Hospital, has a lease in place with Bendigo Health Care Group, a state government entity, securing a stable, long-term income stream for its new owner – with a long-term lease locked in until 2044.
Colliers’ Victorian state chief executive Rob Joyes said the property’s lease structure and location made it particularly attractive to investors.
“The purpose-built residential healthcare complex, specifically designed to accommodate essential workers from Bendigo Hospital, attracted a diverse profile of buyers,” Mr Joyes said.
This 120-apartment complex is changing the game for essential worker housing.
Inside the purpose-built healthcare accommodation complex near Bendigo Hospital has sold in a competitive bidding war.
The passing yield on the sale was 6.2 per cent, reflecting growing demand for healthcare accommodation as an investment class, particularly in regional cities.
Colliers Managing director for Ballarat, Geelong, and Bendigo, Travis Hurst, said Bendigo had become an increasingly attractive location for institutional investors.
“This trend is driven by consistent population growth over the last 10 to 15 years, which provides a stable demand for assets,” Mr Hurst said.
“The region has shown solid capital growth, making it an appealing long-term investment.”
The sale also comes as regional hospitals struggle to attract and retain staff, with housing affordability emerging as a key challenge in workforce recruitment.
As hospitals struggle to attract staff, this subsidised accommodation plays a key role.
While the Bendigo complex does not primarily cater to local permanent staff, Mr Hurst said it plays a critical role in housing junior doctors, secondees, and overseas-trained medical staff who relocate for work at Bendigo Hospital.
“This subsidised living model has a significant impact in supporting overseas-trained healthcare workers, secondees, and junior doctors in their early career. It is a means to attracting the workforce in areas of need,” he said.
Unlike traditional rental accommodation, the cost of housing at the complex is covered by the secondee hospital or agency, making it financially viable for healthcare professionals relocating to the region.
Colliers’ head of transaction services, Asia Pacific healthcare and retirement living, Ian Sanders said this model provided strong security for investors and the asset’s Triple Net Lease structure was another key selling point, shifting maintenance, capital expenditure, and operational costs onto the tenant, Bendigo Health Care Group.
“The Triple Net Lease provides a safety net for the investors against increases in construction, maintenance, taxation, and insurance costs,” Mr Sanders said.
With a long-term lease locked in, this Bendigo property is seen as a safe bet.
“These costs have been among the strongest drivers of inflation and have at times increased beyond the consumer price index numbers published, which are based on the broader economy.
“So, risk is mitigated while the returns for the investor are safely indexed, similar to a Government bond-like covenant.”
Mr Sanders said the demand for healthcare accommodation remains strong, with private investors, charitable organisations, and religious groups leading the development of essential worker housing.
However, further government support in planning and land supply would help address growing shortages.
“There is continuing unmet demand in both areas, which, not unlike other residential models, would be greatly assisted by more availability of land and provision of timely planning and development processes,” he said.
“The sale underscores the growing investor appetite for essential worker housing, with expectations that similar models could be replicated in other regional centres.”
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