“Like all aspects of the commercial property market, there are some segments and sectors of the market doing better than others. High-street retail is showing some positive figures overall, but some high streets and shopping centres in secondary locations will be moving more slowly”
– Andy Miles – Rightmove
Demand for retail property investment rose by 30% in Q3 2025 compared with the same period in 2024. The office market is also showing signs of recovery, with investment demand up by 31% and leasing demand up by 7% year on year. Overall, commercial property investment grew by 11% over the same period.
The UK retail sector continued its recovery in the third quarter, according to new data from Rightmove.
Demand for retail property increased by 30% compared with Q3 2024, measured by enquiries to commercial agents about listings, while the supply of retail property fell by 2%.
These figures follow the momentum from the previous quarter, when retail investment demand rose by 35% year on year.
High-street retail, which forms a significant portion of the sector, saw investment demand rise by 45% compared with Q3 last year. That is slightly below the Q2 year-on-year figure of 56% but remains strong.
The renewed interest in retail investment is being driven by multiple factors, most notably cautious cuts to the Bank of England’s Base Rate. The rate was reduced to 4% on 7 August, marking the fifth reduction since August 2024.
Outside retail, the office market continues to recover. Investment demand for office space increased by 31% year on year, and leasing demand rose by 7%. Several London markets experienced notable boosts in leasing activity, including Westminster, the City of London, and Hackney.
The industrial sector continues to perform strongly. Demand to lease industrial space rose by 29% year on year, while investment demand surged by 53%.
Bank Rate cuts are supporting broader growth in commercial property investment. Rightmove’s data shows that the overall demand for commercial property investment rose 11% in Q3, following a 20% increase in Q2.
“Bank Rate cuts are supporting investment in the retail sector, and the commercial property sector more broadly compared with last year,” explained Andy Miles, MD of commercial real estate at Rightmove. “The retail sector is also being helped by more realism over values, and an improving occupational market.”
He added, “However, like all aspects of the commercial property market, there are some segments and sectors of the market doing better than others. High-street retail is showing some positive figures overall, but some high streets and shopping centres in secondary locations will be moving more slowly.”
Claire Williams, head of UK & European industrial research at Knight Frank, comments, “The occupier market was active in Q3: we recorded 11 million sq ft of take-up, on top of 21 million sq ft in the first half of 2025. That puts the year on track to beat last year’s total of 36 million sq ft and to match or exceed the ten-year average.”
“Manufacturing demand has strengthened, accounting for 36% of year-to-date take-up. E-commerce is also a key driver, with rising activity from Chinese platforms in the UK. So far this year, Chinese firms have taken more than 2 million sq ft of space, more than double the amount of space they did in the whole of 2024.”
“With some Chinese firms aiming to rapidly expand their operations in the UK, we expect this demand to carry into 2026, supporting both leasing and investment volumes. In the investment market, we’ve recorded £1.4 billion of transactions this quarter, though this is down compared with Q3 last year. We expect Q4 to provide a boost to the annual total, with several sizeable transactions pending or already completed.”
Steve Rodell, managing director – retail & leisure at Christie & Co, said, “Despite broader economic uncertainty and reports of declining consumer spending, trade remains steady across needs-driven retail sectors such as convenience stores and petrol stations. These essential services continue to attract strong investor interest. While discretionary spending and luxury retail may feel the pinch if consumers tighten their belts, the overall retail property market remains resilient and we’re seeing high demand for quality assets in desirable locations.”