National Investment Market Overview
Offices
Overview
Subdued transaction volumes, a clear flight to quality, and a widening divergence between prime and secondary assets define the South East and wider regional office markets in H1 2025.
Retail Warehouse
Overview
Year to date retail sales are up +2.4% with volumes up +1.4% year-on-year. Volume growth in April was a return to pre-covid era growth, largely driven by summer sales.
Macroeconomic pressures including business rates reform, national insurance changes, and minimum wage increases present headwinds. Fortunately, historic rent rebasing and portfolio right-sizing have left many retailers better positioned to weather these challenges. However, Hobbycraft, Poundland and River Island have recently announced restructuring plans, where a more aggressive approach has been required.
Industrial
Overview
The UK industrial and logistics market remained resilient in the first half of 2025, despite global economic headwinds and rising vacancy rates. Prime rental growth averaged 4.6% in 2024 and is projected to reach 4% by the end of 2025, with capital values increasing by 0.2%–0.4% monthly. Investment volumes totalled £3.3Bn in H1, and take-up for large units (100,000+ sqft) reached 14.7M sqft. However, vacancy rates rose to around 7%; the highest since 2011, largely due to an influx of speculative and secondary Grade-A stock. The sector continued to outperform offices and retail, with forecasted total returns of 8.4% annually through 2028.
Alternatives
Overview
The UK alternatives real estate sector demonstrated continued demand and resilience in H1 2025, although a lack of available stock continued to hamper transaction volumes. Hotel investment volumes reached £1.59Bn, with a marked shift towards single-asset deals and regional diversification beyond London. Allsop sales showed sustained demand for car showrooms, with yields remaining stable between 6% and 7% NIY. For example, Allsop sold showrooms in Ayr and Reading at NIYs of circa 6.7%. Furthermore, we have recently gone under offer on a further two showroom assets in Sheffield and Bristol.