The words “reopening trade” may feel like a situation light years away for those still suffering under lockdowns. But some of the stocks in most affected sectors are equally raring to thrive when things return to normal.


Just what is the ‘reopening trade’?

The “reopening trade” alludes to companies restricted by COVID-19 shutdowns but – if the easing of previous lockdowns are anything to go by – primed for a boom in demand when restrictions ease.

Sectors and stocks considered part of the reopening trade include (but are not limited to) travel and tourism, hospitality and even serviced offices.

With New South Wales and Victoria set to exit lockdown sometime before the year is out, it is closer than it probably feels.

And if the exit of previous lockdowns in those and other states is a guide, pent up demand will be unleashed.

But some companies are preparing to thrive when the demand returns to the point of forking out cash on other businesses.


Auctus bets on returning to travel

Auctus (ASX:AVC) was one ASX stock making a foray in the reopening trade.

It announced it was launching a new fund of between $60 million and $100 million to buy Lux Group – a travel company which owns the Luxury Escapes Brand.

Luxury Escapes was founded in 2009 and has over 3.2 million members across Australia and the world.

The purchase is far from the only peculiar acquisition Auctus has made, including during COVID-19. Its other assets include US college student housing, energy storage, space infrastructure and pet retail.

While none of these were wiped out to the extent travel was during COVID-19, managing director Campbell McComb told Stockhead things would bounce back.

“I think there’s a fair bit of interest out there in the ‘opening up trade’ as they’re calling it,” he said.

“No one knows when the world is going to get back to some form of normality but when it does, people are going to want to go on a holiday or an extended holiday even.”

“There’s a whole lot of thematics that push you in the same direction and hopefully there’s going to be a pop in the travel market when we get back to normality.”

Auctus will be purchasing the business from fellow ASX listee HT&E (ASX:HT1).

“They held it for a number of years and we approached Lux around putting some money into the company,” McComb explained.

“And at the same time they suggested a tidy up of the register so we’ve ended up potentially buying equity but injecting capital into Lux and so they can come out flying in terms of putting capital into the expansion and growth side of the business.”

“I think everyone can see the thematic and then it’s obviously just around Lux itself as a strongly growing business in what is likely to be a strongly growing market with some tailwinds over the next couple of years – I think it’s a compelling opportunity.”


Centuria bets on workers returning to the office

Another space that’s not a good place be when people are working from home is in the office space – either as a landlord or operator.

But Centuria Office REIT (ASX:COF) is bulking up for when lockdowns end.

Yesterday it announced was buying two new office properties in Sydney and Melbourne for $273.1 million all up – 101 Moray St in South Melbourne and 203 Pacific Highway at St Leonards in Sydney’s North Shore.

It says this will make it Australia’s largest listed pure play office REIT with a portfolio worth $2.3 billion.

“The acquisitions are high quality office properties, strategically located in key Melbourne and Sydney near city and metropolitan locations that offer excellent surrounding tenant amenity and accessibility,” said fund manager Grant Nichols.

The fund fell from $3.25 to $1.63 in the COVID-19 crash last year but has recovered to $2.59 yesterday.

Centuria Office REIT (ASX:COF) share price chart