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Commercial real estate in the UK - statistics & facts

Whether it is industrial space, a distribution center, warehouse, office, or a shop, the vast majority of businesses need real estate to operate. This makes commercial real estate closely connected to the overall economic performance in the country. The commercial real estate sector in the United Kingdom (UK) has faced a number of challenges in recent years: Starting with the decision to leave the European Union in 2016, moving forward with several years of lengthy negotiations, and culminating with the coronavirus (COVID-19) crisis that paralyzed the world economy in 2020. While this may be the case, the UK still boasts one of the largest commercial real estate markets in Europe.

Office steps back, industrial and logistics real estate steps forward

Offices have long been investors’ top choice when it comes to commercial real estate investments in the UK, accounting for over 50 percent of total investment. In 2020 and in the first quarter of 2021, however, investors’ interests shifted and capital flows towards industrial and logistics real estate increased. Five years of Brexit negotiations have certainly influenced the office space landscape, with the coronavirus (COVID-19) pandemic bringing additional insecurity about the future of offices. Leasing activity slowed down in almost all key office markets between the first quarter of 2020 and the first quarter of 2021. Central London, which has long been one of the leading office real estate markets in Europe saw take-up fall for the second year in a row and halve between 2019 and 2020. Meanwhile, the annual take-up of industrial and logistics space has been increasing. In Birmingham, which is one of the leading logistics hubs in the UK due to its strategic geographic location, leasing activity has been growing year-on-year since 2017 and in 2020, take-up measured over 1.9 million square meters. A similar trend can also be observed in the London and South East market.

Difficult times ahead for the retail real estate sector

Retail is the smallest of the major commercial real estate sectors and undoubtedly the one worst hit by the coronavirus (COVID-19) crisis. Since the outbreak of the pandemic, retailers have experienced weaker footfall and spending, forcing many to shut down. Naturally, this translates into a decrease in demand and rents heading down. Between the fourth quarter of 2019 and the fourth quarter of 2020, retail rents fell by over 15 percent. Furthermore, standard retail and shopping center rents are forecast to continue falling in the next five years.

Key figures

The most important key figures provide you with a compact summary of the topic of "Commercial real estate in the United Kingdom" and take you straight to the corresponding statistics.

Office

Industrial and logistics

Retail

Interesting statistics

In the following 5 chapters, you will quickly find the {amountStatistics} most important statistics relating to "Commercial real estate in the United Kingdom".

Commercial real estate in the United Kingdom

Dossier on the topic

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Commercial real estate in the UK - statistics & facts

Whether it is industrial space, a distribution center, warehouse, office, or a shop, the vast majority of businesses need real estate to operate. This makes commercial real estate closely connected to the overall economic performance in the country. The commercial real estate sector in the United Kingdom (UK) has faced a number of challenges in recent years: Starting with the decision to leave the European Union in 2016, moving forward with several years of lengthy negotiations, and culminating with the coronavirus (COVID-19) crisis that paralyzed the world economy in 2020. While this may be the case, the UK still boasts one of the largest commercial real estate markets in Europe.

Office steps back, industrial and logistics real estate steps forward

Offices have long been investors’ top choice when it comes to commercial real estate investments in the UK, accounting for over 50 percent of total investment. In 2020 and in the first quarter of 2021, however, investors’ interests shifted and capital flows towards industrial and logistics real estate increased. Five years of Brexit negotiations have certainly influenced the office space landscape, with the coronavirus (COVID-19) pandemic bringing additional insecurity about the future of offices. Leasing activity slowed down in almost all key office markets between the first quarter of 2020 and the first quarter of 2021. Central London, which has long been one of the leading office real estate markets in Europe saw take-up fall for the second year in a row and halve between 2019 and 2020. Meanwhile, the annual take-up of industrial and logistics space has been increasing. In Birmingham, which is one of the leading logistics hubs in the UK due to its strategic geographic location, leasing activity has been growing year-on-year since 2017 and in 2020, take-up measured over 1.9 million square meters. A similar trend can also be observed in the London and South East market.

Difficult times ahead for the retail real estate sector

Retail is the smallest of the major commercial real estate sectors and undoubtedly the one worst hit by the coronavirus (COVID-19) crisis. Since the outbreak of the pandemic, retailers have experienced weaker footfall and spending, forcing many to shut down. Naturally, this translates into a decrease in demand and rents heading down. Between the fourth quarter of 2019 and the fourth quarter of 2020, retail rents fell by over 15 percent. Furthermore, standard retail and shopping center rents are forecast to continue falling in the next five years.

Interesting statistics

In the following 5 chapters, you will quickly find the {amountStatistics} most important statistics relating to "Commercial real estate in the United Kingdom".

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