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 of the country. The commercial real estate sector in the United Kingdom (UK) has faced a number of challenges in recent years: Starting with the UK’s 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 more than half of total investment volumes. In 2020 and 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 pandemic bringing additional insecurity about the future of offices. Nevertheless, the office sector is on a path to recovery: nearly all key office markets saw take-up increase between the first quarter of 2021 and the first quarter of 2022. The volume of office space transacted in Central London - one of the leading office real estate markets in Europe – grew by nearly 60 percent during this period. Meanwhile, the annual take-up of industrial and logistics space has risen for a third year in a row, proving robust demand for this property type. For Birmingham, which is a major logistics hub in the UK due to its strategic geographic location, leasing activity has been growing year on year since 2017.

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. 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. Although rental growth had stalled for solid two years, the first quarter of 2022 saw rents increase by roughly nine percent over 2019 levels. In the next five years, standard retail and shopping center rents are forecasted to have a slower recovery than other property types.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by Statista Research Department, Dec 19, 2023

Key insights

Estimated value of the commercial property market
1.7tr USD
Market cap of the listed real estate market
71.5bn USD
Commercial real estate investment
61.9bn GBP
Get more insights

Editor’s Picks Current statistics on this topic

Prime yields of commercial property in the United Kingdom (UK) in April 2022 and April 2023, by property type

Commercial Real Estate

Prime yields of commercial property in the UK 2023, by property type

Commercial property rental value growth forecast in the United Kingdom (UK) from 2023 to 2027, by sector

Office

Rental growth forecast for different commercial property types in the UK 2023-2027

Prime industrial rents of new small warehouse units in the United Kingdom (UK) as of January 2022, by city (in GBP per square foot)

Industrial

Prime industrial rents for small warehouses in the UK January 2022, by city

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Industrial and logistics

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Retail

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Further reportsGet the best reports to understand your industry

Office real estate in London (UK)
Office real estate in London (UK)
Real estate in the United Kingdom (UK)
Real estate in the United Kingdom (UK)
Office real estate in France, Spain, Italy, and Portugal
Office real estate in France, Spain, Italy, and Portugal
Real estate in Germany
Real estate in Germany
Real estate investments on the European market
Real estate investments on the European market
Commercial real estate in Europe
Commercial real estate in Europe
Industrial and logistic real estate in the United Kingdom (UK)
Industrial and logistic real estate in the United Kingdom (UK)
Warehousing in Europe
Warehousing in Europe
Commercial real estate in France
Commercial real estate in France

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