Selling for $158,000 above the reserve price, the auction success of Leongatha’s Subway fast food site last Wednesday is another sign of the COVID times.

COVID-19 has done some strange things to life as we knew it, and to the economy.

You don’t want to own a hardtop shopping centre in Melbourne but, according to former Leongatha real estate agent, Raoul Holderhead, now a commercial property sales guru in Melbourne, owners of fast food outlets, service stations, supermarkets and liquor outlets have hit the jackpot.

And this proved to be the case when the Subway lease and buildings in Anderson Street Leongatha was offered at a virtual auction, online out of Sydney last Wednesday, together with 10 other such outlets across Australia.

The result, according to Mr Holderhead, was a “phenomenal” $158,000 above the reserve, selling for $908,000 with 16 people pre-registering to bid.

“It’s all that, low bank interest and concern about where to get secure returns, but we’ve seen extremely strong interest in what we call essential service assets, the businesses that have had to stay open through this; the petrol stations, supermarkets and liquor outlets.

“And you can certainly put the fast food outlets into that as well. They’ve continued to do good business.

“The Subway in Leongatha is located between KFC and McDonalds, in a prime location. It’s been operating for 15 years and the operators know what they are doing, and have just signed a new seven-year lease.

“We were especially delighted for the local vendors, who we know very well, and they were also delighted with the result.

“At the end of the day, it shows there’s still plenty of strength in the Leongatha market and as a former local, I’m pleased to see that as well,” said Raoul.

Mr Holderhead said of the 10 properties offered with the Leongatha Subway last Wednesday, nine sold for similarly good results, grossing $33 million on the day.

“To give you an idea of the strength of the market, we had 10 people pre-register with a deposit of $10,000, repaid obviously to the unsuccessful bidders, but it’s an indication of the level of interest.

“We actually have 20,000 people registered on our database who like to know when these auctions are coming up and what other opportunities might exist and 19,000 of them are cashed-up buyers looking for these sorts of investments.

“Good quality commercial real estate in that essential food and services sector is really going crazy at the moment, another one of those unanticipated results of the pandemic,” Mr Holderhead said.