Commercial property has faced a difficult decade. Inflation, taxes, the impact of Covid and increased regulation have all had an impact on the sector – yet there is growing confidence in commercial property investment.
As shown in our new report Cities in Focus 2025: Commercial Property Insights, the outlook is improving – and brokers are well-positioned to capitalise on it.
Research we conducted for the report found that 89% of surveyed landlords plan to remain in the sector through 2025, with around a quarter looking to reinvest rental income into it. In particular, office, retail, and logistics are all showing encouraging signs of recovery.
Demand for office space is seeing a resurgence, driven largely by the shift back to physical workplaces and hybrid working models, with 82% of professionals viewing office space as a good investment over the next five years and 16% expecting revenue growth of up to 30% by 2030. New demands for these spaces have emerged, prioritising flexible layouts, high-spec amenities, and strong sustainability credentials.
The same is true of the retail sector, where the value of sales rose 1.4% to £517bn last year, and the number of transactions increased by 0.7%. While this might not sound substantial, after two previous years of decline, it is certainly a positive step forward. This year seems to be following a similar trajectory; sales volumes in the first three months grew by 1.7% when compared to the same period in 2024.
Whilst the sector still faces challenges from inflation, tax changes and tariffs, investors are cautiously optimistic.
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According to our survey, 76% of investors see retail as a good long-term investment, and 35% expect revenue growth over the next five years.
The rise of e-commerce has also had a big impact on the retail sector, creating new opportunities in logistics and distribution. With online sales continuing to climb, demand for logistics and distribution hubs is only increasing. This is especially true of centrally located cities with good transport links, Birmingham being a good example.
Urban regeneration is another factor playing a key role. City centres like Manchester and Glasgow are experiencing renewed interest, with mixed-use developments and revitalised high streets driving retail and leisure footfall. According to our survey, Manchester was ranked among the UK’s top locations for retail and leisure, while Glasgow has seen a surge in chain restaurant and cafe openings over the past year.
For brokers, this presents an opportunity to demonstrate value. Acquiring in-depth knowledge of local markets and different types of commercial assets, brokers can help guide clients through shifting economic and regulatory conditions.
Crucially, they can also offer access to a broader range of finance options beyond traditional commercial mortgages.
Specialist lending has a big part to play here; companies like Together that are able to take a bespoke approach with broad affordability options, acceptance on varied income types and financing for non-standard properties will be essential in finding the right solutions for your clients.
To succeed in the current environment, brokers must be able to adapt and offer the right solutions for their customers. Those who stay agile and informed will surely stand out from the crowd.
