Investors Snap Up ‘COVID-Proof’ Essential Services During Lockdown

Investor demand for essential services properties remains at record levels despite Greater Sydney’s prolonged coronavirus lockdown, with buyers snapping up more than $90 million in “COVID-proof” assets at auction.

There was strong competition for petrol stations, childcare centres, fast food assets and medical properties in Burgess Rawson and Cushman & Wakefield’s separate Sydney portfolio auctions, despite them being conducted remotely due to the lockdown.

Burgess Rawson director Darren Beehag said the pandemic has boosted demand for essential services assets, as investors target businesses able to trade through lockdowns and COVID restrictions.

“The market is as strong as we’ve ever seen it right now,” he said.

Mr Beehag said the strength was across essential services assets such as childcare, service stations, medical, fast food and government-leased properties.

“Some of those uses which we used to call recession proof, now we’re saying they’re not only recession proof but they’re COVID proof,” Mr Beehag said.

“The market’s really gravitated towards those investments because they’re seen as a safe haven, and they’re willing to pay a premium to secure them.”

Burgess Rawson’s Sydney auction was conducted remotely due to the lockdown, with phone and online bids received from 102 registered bidders across the country. Bidding was also available in person at the agency’s other state offices.

Sixteen of 18 properties sold for a combined $42.2 million as part of Burgess Rawson’s Sydney portfolio auction, including seven that were sold before Tuesday’s auction day.