Investment demand for retail commercial property shows a 35% increase over this time last year, mostly thanks to lower interest rates, reports Rightmove.
This reverses last year’s trend when retail investment demand was 15% lower than in 2023.
High Street retail investment demand has led the way, up 56% over the last year – the highest level since 2021.
The portal – the largest showcase for available commercial property in the UK – says the supply of retail units has fallen 4% compared with last year, because of the higher demand.
Meanwhile demand from businesses to lease retail space is up 10%.
Rightmove says the office sector is also rebounding with demand rising 65% compared to a year ago, reversing a 13% drop in 2024 over 2023.
Leased office space demand is up by 12%, and in London it’s up 14%. Key office markets such as Westminster and the City of London have seen even sharper rises, up by 29% and 21% respectively.
Andy Miles, Rightmove’s managing director of commercial real estate, says: “The growth of the industrial sector has been one of the main stories so far this year, but we can see a resurgence to invest in retail and office space too. Rate cuts are helping investment into commercial property, and after a period of decline it appears that retail and office spaces are becoming more attractive to invest in.”
Responding to the figures, Michael Sears of Propertymark’s commercial advisory panel, comments: “It is positive to see a rejuvenated appetite regarding investment within the retail and office space sectors, especially considering habits have shifted significantly in recent years. Online commerce fundamentally changed how people shop in many cases, and the pandemic accelerated the home working revolution.
“However, these figures are the highest they have been since 2021 and show that there is still a healthy desire for high-quality retail space across the UK and that many employers are also finding a new balance for their office space requirements that complements hybrid working arrangements with their colleagues.
“These factors added together are a positive sign of a high street resurgence in many regions.”
