UK commercial property investment volumes rebounded strongly in Q4 2025 with £17.5bn of assets changing hands, representing a 78% quarter-on-quarter increase and a 13% year-on-year rise, according to the latest data from Carter Jonas.
Q4 activity was around 32% higher than the five-year quarterly average, however, the rolling annual investment total of £47.8bn recorded in 2025 was around 10% below the five-year average of £53.2bn.
Approximately 32% of all investment occurred in London, up from 23% in Q3 2025, but below the 35% five-year average. Investors primarily targeted offices, retail assets and hotels in the final quarter, with industrial investment activity hitting £4.9bn – 46% above the five-year quarterly average, making it the strongest quarter for industrial investment in four years.
Ali Rana, head of national investment at Carter Jonas, said: “UK commercial property markets are entering a phase of stabilisation, supported by improving investor sentiment and modest capital growth alongside stable rental income. The narrowing gap between buyer and seller pricing expectations is leading to improved pricing clarity and a higher likelihood of transactions completing, reflecting market adaptation to new pricing norms rather than aggressive yield compression.
“Easing interest rates and active lending by UK banks are encouraging leveraged investment, with investor attention shifting from interest rates to asset quality, income durability, and long-term relevance. Office markets show selective re-engagement, favouring prime assets amid ongoing polarisation, while industrial, living (build-to-rent), and retail sectors demonstrate varied performance with industrial and living sectors attracting strong interest due to structural strengths, and retail recovering amid challenges.”