As daycare real estate experiences strong demand, a nationwide portfolio of KinderCare Learning Centers properties has secured a huge refinancing deal.
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An entity linked to NRT — a private REIT previously known as National Realty Trust that is backed by the billionaire Milken brothers — secured a $650M loan from Goldman Sachs, according to a series of Massachusetts mortgage records dated Sept. 2.
The portfolio extends far beyond Massachusetts: Morningstar Credit data and prior reports show the loan is refinancing a 2021 CMBS loan tied to 549 daycare properties totaling more than 4M SF across 37 states.
Attorney Stan Maron, who represented NRT in the deal, didn't respond to Bisnow's request for comment. Goldman Sachs also didn't respond to a request for comment.
The loan will pay down the $642M loan NRT took out in July 2021. The initial loan was originated by Goldman Sachs and JPMorgan Chase, Commercial Observer reported at the time. The CMBS loan had a floating rate with a two-year term, plus three one-year extension options.
The loan matured last month, and the latest remittance data says the loan was paid off in full last month, according to Morningstar, indicating the borrower secured a refinancing deal.
As of March 2026, the net operating income for the portfolio was more than $85M, well above the property's debt service cost of $42M, according to Morningstar Credit's CMBS loan database.
The portfolio dates back to 2015, when KinderCare entered into a sale-leaseback agreement with NRT. The daycare operater signed a master lease for its properties after NRT sold the company, then known as Knowledge Universe Education, to Partners Group for $1.3B.
Billionaire financier and philanthropist brothers Lowell and Michael Milken, along with Oracle co-founder Larry Ellison, founded KUE. As part of the deal to sell, the Milken brothers held on to a significant portion of the real estate under NRT, according to Commercial Observer's 2021 report.
Last month, KinderCare and NRT executed a fifth amendment to the master lease agreement that restructured occupancy terms for the more than 500 child center sites. The agreement also transferred 13 sites to a newly formed entity known as KCP RE II LLC.
The restructuring came after KinderCare's stock fell almost 50% in mid-August, from $4.83 to $2.60, following Q2 results that shed light on continued enrollment decline and poor earnings.
Childcare real estate has been an attractive niche investment for private equity firms as the need for daycares continues to grow and they begin to fill up underutilized retail space. The U.S. childcare market was valued at $65.2B as of 2025 and is projected to hit $109.9B by 2033, according to CNBC.
KinderCare Education has more than 2,700 early learning centers and programs across the country.
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