The amount of money invested in UK commercial property has fallen across all sectors, new research has found.
Sirius Property Finance analysed UK commercial property investment over the past six months, and compared it directly to investment over the six preceding months.
The research found that in terms of money invested, the biggest decline has been seen in the industrial sector, falling by 55%. In the last six months, £2.9bn has been invested, down from £6.9bn in the six months before that.
Office space investment has declined by 55% in the past six months, driven by a 63% drop in investment outside of central London. Despite this, office space is still receiving the highest amount of total investment at £3.8bn.
Meanwhile, retail & leisure has declined by 45%, with a 75% drop in shopping centre investment, followed closely by a 74% fall in leisure investment.
In terms of the number of transactions, offices have seen the sharpest decline, falling by 44%, driven by a 64% drop in central London.
Retail & leisure transactions have fallen by 40%, with shop units enduring the most severe decline (47%). Meanwhile, industrial transactions have fallen by 35%.
The average amount of money invested via each transaction has also fallen across the board. The biggest drop has come from the industrial sector, falling 35% from £22m to £14.3m.
The average investment made into office space has reduced by 19%. For retail & leisure the decline is -8%.
Kimberley Gates, head of corporate partnerships at Sirius Property Finance, commented: “It has been a difficult six months for the commercial sector. It has been struggling since the start of the pandemic and the subsequent retreat from town and city centres, but now that additional economic uncertainty has been placed on top, the situation has worsened.”
